🎉 NFP: Bitcoin, AAPL to the Moon?

Good Morning!

The financial world's holding its breath for the US jobs report dropping today. Asian markets are tip-toeing, oil's having a rough week, and even the mighty dollar's feeling the heat. Wall Street's crystal ball is foggy – we're expecting 165,000 new jobs and unemployment at 4.2%, but after some soft data, whispers of a Fed rate cut are getting louder. The payroll numbers could make or break these predictions, so keep your eyes peeled. With Fed bigwigs set to speak right after, we're in for a rollercoaster Friday in the markets.

In today’s email:

• FedWatch: All eyes on today’s NFP data

• Bitcoin: Bitcoin weak around $56k, could NFP spark a rally?

• AAPL: GS sees 25% upside

• Gold: A strong buy if it drops to $2300/oz

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THE BIG IDEA

Global markets brace for crucial US jobs report, with potential to shape Fed policy and economic outlook

The financial world is holding its breath as we await the August US jobs report, a pivotal moment that could shape the Federal Reserve's next moves. Wall Street's crystal ball is cloudy – expectations hover around 165,000 new jobs and unemployment at 4.2%. But recent data has been a mixed bag, with private sector job growth hitting a 3.5-year low, while jobless claims declined.

This economic Rorschach test has traders second-guessing themselves. The odds of a supersized 50-basis point Fed rate cut in September have climbed to 40%, up from 34% last week. But some experts are waving red flags. George Lagarias, chief economist at Forvis Mazars, warns a half-point cut could be "very dangerous," potentially spooking markets and sending recession alarm bells ringing prematurely.

The stakes are high, with the dollar wallowing at one-week lows and Asian markets tip-toeing nervously

Oil's having a rough week too, facing its worst slump since October 2023. Even the mighty US stock market is feeling jittery, with Nasdaq futures down 0.6% and S&P 500 futures slipping 0.3%.

Recent Services PMI reports add another layer of complexity. Both ISM and S&P Global show the services sector growing faster than in recent months, with new orders surging. However, rising input costs and price pressures in this crucial sector could keep the Fed on its toes.

All eyes are now on the payroll numbers and the Fed's reaction. With bigwigs like Christopher Waller and John Williams set to speak right after the data drop, we're in for a rollercoaster Friday. The message is clear: this jobs report could make or break the market's mood and set the tone for the Fed's next chess move in the high-stakes game of monetary policy.

MARKETS AT A GLANCE

TOP NEWS

Former PBOC Governor Yi Gang breaks silence on China's deflation concerns, urging immediate action to combat falling prices and stimulate economic growth

In a rare admission, Yi Gang, ex-governor of China's central bank, just dropped a bombshell: deflation is threatening the country's growth. Speaking at the Bund Summit in Shanghai, he stressed the need to turn the GDP deflator positive and hoped for the producer price index to hit zero by year-end. With weak domestic demand and falling prices, Yi's call for proactive fiscal policy and accommodative monetary stance echoes economists' concerns. It's a stark departure from the usual hush-hush approach to economic woes in China, signaling potential shifts in policy ahead.

Oil prices edge up amid mixed signals, with U.S. crude stock drawdown and OPEC+ production delays offsetting uncertain economic data

The oil market's playing seesaw. Prices inched up as traders weighed a hefty U.S. crude inventory drop and OPEC+'s decision to hit pause on production hikes against some wishy-washy employment data. Brent crude and WTI both saw slight gains, with analysts pointing to these bullish signals and a weaker dollar as key drivers. Despite hitting recent lows, the black gold's finding some sparkle in the mixed economic landscape. Keep an eye on those payroll numbers - they might just tip the scales.

Goldman Sachs predicts a potential 25% upside for Apple stock, citing four catalysts from the upcoming iPhone 16 reveal

Goldman Sachs is bullish on Apple, eyeing a juicy 25% upside as we approach the iPhone 16 reveal. The potential game-changers? Price hikes (yes, you read that right), early AI features, surprise iPad drops, and carrier promo bonanzas. With iPhone revenue growth expected to hit 9% in both 2025 and 2026, it seems the tech giant's AI investments might just pay off. Add in a dash of new Apple Watch bling and AirPods 4, and we've got ourselves a proper Wall Street party. Time to take a bite of this Apple?

CRYPTO

Crypto market faces downturn with Bitcoin below $56,000, Aptos leading losses, and Coinbase shares hitting 7-month lows

Bitcoin's flirting with the $56,000 mark, while Ethereum's slipped below $2,400. Aptos is leading the nosedive, thanks to an upcoming token unlock that's got investors sweating. Meanwhile, Coinbase shares are looking as appetizing as day-old sushi, hitting lows we haven't seen since February. With Friday's jobs report looming, the market's holding its breath. Will we see a bounce or more red?

ETC Group's André Dragosch predicts crypto rally despite recession signs, citing Fed policy shift and decreasing Bitcoin sensitivity to global growth

Despite August's rollercoaster ride, ETC Group's André Dragosch is betting on a year-end rally. Why the optimism? The Fed's hinting at looser monetary policy, Bitcoin's growing resilience to global economic hiccups, and the dollar's weakening grip. Even with recession red flags waving, Dragosch sees the recent market dip as a springboard for a bull run. So, while the economy might be teetering, crypto could be gearing up for a grand finale.

Bitcoin yield opportunities are expanding through Layer-2 networks and DeFi, offering higher returns than traditional options

The days of Bitcoin being a couch potato are over. Layer-2 networks and DeFi are giving BTC a chance to flex its yield muscles. We're talking Core Chain's stBTC flashing an 8.8% reward rate, leaving Ethereum's 3.4% in the dust. Lightning Network's cooking up a tasty 5.62% APR for node operators. Even institutional players are sniffing around, with Valour and 21.co launching BTC staking products. The crypto yield game's evolving fast.

Ether underperforms Bitcoin by 44% since proof-of-stake switch, with analysts predicting potential further decline due to weaker network activity and growing supply

Looks like Ethereum's been running a marathon in cement shoes since "The Merge." CryptoQuant's number crunchers say ETH's been lagging behind Bitcoin by a whopping 44% since switching to proof-of-stake. Even Solana and BNB are leaving ETH in the dust. What's the deal? Weaker network activity and a ballooning supply are the prime suspects. With ETH/BTC trading at lows we haven't seen since April 2021, some analysts are betting this underdog might have further to fall. Is ETH down for the count, or just catching its breath?

GOLD

TD Securities' Daniel Ghali sees gold as a buy at $2,300, while platinum may have found a bottom, and copper remains under pressure

Gold’s current overbought status suggests a potential drop to $2,300, making it a buy, according to Daniel Ghali of TD Securities. Platinum appears to be finding a floor, driven by algorithmic trading and stable demand. However, Ghali remains bearish on copper, citing signs of a global recession, larger-than-expected surpluses, and limited reasons for long positions.

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