🚨 China's Manufacturing PMI Today!: What It Means For You

Good Morning!

Markets are wrapping up 2024 with more whimpers than bangs. Asia's keeping it low-key today, with treasury yields playing spoilsport to Wall Street's party. While the Nikkei's sitting pretty on a 20% yearly gain, South Korea's market has been caught in a political whirlwind, down 9% for the year. Meanwhile, Chinese markets managed to squeeze out a 16% gain – though most of that came from a two-week stimulus sugar rush in September. The dollar's been flexing all year, up 6.5% against major currencies, while gold's shining bright with a 28% gain despite the greenback's strength. Oil? Well, it's been stuck in OPEC's waiting room all year.

In today’s email:

• China: Manufacturing PMI today 

• Bitcoin: Looking weak, below $94K

• DEX: Volume hits a new ATH of $320B in December!

• Gold: Strongest commodity of 2024 💪🏼

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THE BIG IDEA

China's manufacturing sector shows resilience with expected third consecutive month of expansion, though looming Trump tariffs and property sector challenges cast shadows on 2025's outlook

The dragon's factories keep humming into the new year, with December's manufacturing PMI expected to hold steady at 50.3 – marking a hat-trick of expansion months. Beijing's playing economic chess, rolling out policy moves to prop up the wobbling property sector (where a whopping 70% of household savings are parked) and boost domestic demand. But there's a Trump-shaped cloud on the horizon that's making economists and policymakers alike reach for their antacids.

The President-elect's campaign promises are giving Chinese officials heartburn – we're talking potential tariffs that could hit 60% on Chinese goods, plus a 10% levy aimed at strong-arming Beijing over fentanyl-related chemicals. Not exactly the trade dynamics China was hoping for as it targets 5% growth in 2025.

The stakes? Only the future of the world's second-largest economy and its $19 trillion market

The World Bank's giving China a cautious thumbs-up, raising its growth forecasts while warning about the wet blanket of low consumer confidence and real estate blues. Beijing's response? Opening the stimulus playbook – bigger budget deficits, more debt, and looser monetary policy are all on the menu. It's like watching a high-stakes economic juggling act, with policymakers trying to keep all balls in the air.

November's mixed bag of industrial output and retail numbers shows just how tricky nailing that economic landing will be. But with policymakers pulling out all the stops and manufacturing holding its ground, China's economic engine might just have enough steam to weather the storms ahead. The real test? Whether these policy moves can turn the tide in consumer confidence and breathe life back into that crucial property sector, which once represented a quarter of the entire economy. As we head into 2025, all eyes are on whether China's economic strategists can transform these green shoots of recovery into sustainable growth despite the gathering storm clouds of international trade tensions.

MARKETS AT A GLANCE

TOP NEWS

Treasury yields edge lower in year's final trading days as markets digest Fed's hawkish stance and mixed economic signals

The bond market's taking a breather to close out 2024, with 10-year yields dipping to 4.60% after last week's multi-month highs. Fed's recent signals about fewer rate cuts in 2025 have everyone on their toes, while jobless claims paint a mixed picture – new claims down, but continuing claims at a two-year peak. Last economic data points of 2024 trickling in before markets wind down for New Year's.

European markets end 2024 on a cautious note as high bond yields and Trump-related uncertainties dampen investor enthusiasm

European shares are taking a breather, with the STOXX 600 dipping 0.4% as bond yields play party pooper. Tech and industrials are leading the retreat, though the index is still set for a respectable 5.9% yearly gain. German markets crowned 2024's winners, while French stocks played catch-up. Trading's light as markets prep for their New Year's nap.

Oil prices stabilize in year-end trading as market weighs 2025 supply concerns and geopolitical uncertainties under incoming Trump administration

Crude's treading water as 2024 wraps up, with WTI hovering above $70 and Brent near $74. OPEC+'s production strategy looks shakier by the day amid oversupply fears, while Trump's return adds spice to the mix with threats of tariffs on Canada and Mexico, plus potential Iran pressure. Meanwhile, China's demand remains the market's biggest question mark.

CRYPTO

Bitcoin bull Michael Saylor hints at another potential BTC purchase for MicroStrategy, which currently holds $41.4B worth of Bitcoin, while pushing for ambitious digital asset framework

Saylor's dropped his signature Sunday Bitcoin chart, setting crypto Twitter abuzz with Monday purchase speculation. MicroStrategy's already sitting on 444,262 BTC and just scooped up 5,200 more at $106K each last week. Meanwhile, he's pitching a wild plan to Congress – using Bitcoin as a strategic reserve to offset national debt. Talk about thinking big.

Algorithms Level the Crypto Playing Field for All Traders

Algorithmic trading isn’t just for institutional elites anymore—it’s reshaping the crypto landscape, offering tools like machine learning (ML) and natural language processing (NLP) to everyday traders. These technologies bring speed, consistency, and efficiency to a 24/7 market while fostering broader participation. While not without challenges, algo trading is transforming crypto into a more accessible, resilient ecosystem.

Record-Breaking $320B DEX Volume in December Signals Crypto Surge

Trading on decentralized exchanges (DEXs) hit an all-time high in December, surpassing $320 billion. Uniswap led with $103 billion, followed by PancakeSwap and Raydium. Centralized exchanges (CEXs) also saw a spike, with Binance handling $950 billion of December’s $2.78 trillion spot volume, reflecting renewed confidence in both DeFi and traditional platforms.

Altcoin Market Eyes “Euphoria Phase” With $1.13T Milestone in Sight

The altcoin market cap (TOTAL3) sits at $962.78 billion, needing a 16% rise to hit $1.13 trillion—the level traders associate with an explosive "euphoria phase." Gains like AI16Z’s 109% surge reflect optimism, but volatility persists. Traders see potential in altcoins as Bitcoin dominance nears 60%, with many closely watching for TOTAL3's critical breakout.

GOLD

Gold Shines in 2024, Surging 27% Amid Mixed Metals Market

Gold has surged 27% in 2024, outperforming other commodities despite a stronger dollar and rising Treasury yields. US monetary easing, central bank buying, and geopolitical tensions fueled the rally, even as base metals posted mixed results, iron ore slumped 28%, and lithium faced a supply glut. Investors eye 2025 cautiously, with US monetary policy and China’s economic recovery in focus.

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