Stocks Rally After Tumultuous Week While Cryptos Extend Drop Amid Intensifying China Crackdown: Markets Wrap

Stocks rebound after a disordered week where looming interest rate hikes curbed investors’ appetite for inflation-sensitive assets.

article-image

Blockworks exclusive art by Axel Rangel

share

key takeaways

  • 90% of China’s bitcoin mining is estimated to be shut down, according to a report on Sunday from the Global Times.
  • PCE price index will be released on Friday

China’s crackdown on crypto continues… and intensifies. Kicking off the week with a note from the central bank, The People’s Bank of China (PBOC) told the country’s key financial institutions to block all cryptocurrency transactions, one of several anti-crypto efforts the country’s governing body has taken to curb trading of the digital currency.

The central bank said that crypto “spawns the risks of criminal activities such as illegal asset transfers and money laundering, and endangers people’s wealth.”

Following the news, bitcoin dropped again, benchmarking a new two-week low of $31,714 for the largest digital currency.

Insight

Executive Director of ARK36, a crypto hedge fund, Ulrik K. Lykke remains optimistic about the cryptocurrency despite the regulatory crackdowns. “What we think is noteworthy is that worldwide, miners continue to generate on average 30M USD daily, which shows the industry is still highly profitable,” he wrote in an email to Blockworks. “In the short-term, these conditions are naturally causing a negative market reaction, but in the long-term, they can be net-positive. As miners spread to other locations, they will likely choose places with secure access to cheap energy sources.”

Crypto

90% of China’s bitcoin mining is estimated to be shut down, according to a report on Sunday from the Global Times. Bitcoin fell -8.06% after the slew of news.

  • Bitcoin extended its losses to $32,638.53 as of 4:00 pm ET.
  • Ether is trading at around $1,944.58 falling -13.64% over the past 24 hours respectively.
  • ETH:BTC is at 0.06 as of 4:00 pm ET.
  • VIX is down -13.57% to 17.89 as of 4:00 pm ET.

Stocks rebound after a tumultuous week where looming interest rate hikes curbed investors’ appetite for inflation-sensitive assets. Following the Federal Reserve announcement, The Dow Jones Industrial Average benchmarked its worst week in over six months, falling over 500 points in a day. There was a change of tune for equities on Monday as the market stabilized in the morning, recovering from last week’s losses. 

Equities

  • The Dow was up 1.7% to 33,876.
  • The S&P 500 rose 1.4% to 4,224.
  • Nasdaq Composite increased 0.79% to 14,141.
  • Meanwhile in global markets, the Japan Topix index fell 2.4% while MSCI Asia Pacific Index tumbled 1.5%.

Insight

Ray Dalio, founder of Bridgewater Associates, weighs in on inflation concerns, adding that the road to economic recovery may be rocky with tightening monetary policies.  “It’s easy to say that the Fed should tighten, and I think that they should,” the billionaire investor said in an interview with Bloomberg. “But I think you’ll see a very sensitive market, and a very sensitive economy because the duration of assets has gone very, very long. Just the slightest touching on those brakes has the effect of hurting markets because of where they’re priced, and also passing through to the economy.”

Fixed income

  • The US 10-year yields 1.501% as of 4:00 pm ET.

Commodities

  • Crude Oil opened at $71.15 per barrel and ticked up 2.62% to $73.52 as of 4:00 pm ET.
  • Gold is up 0.81% at $1,783.30 as of 4:00 pm ET.

Currencies

  • The US dollar is down -.40%, according to Bloomberg Dollar Spot Index.

In other news

Liquidity provider Amber Group closed a $100 million Series B round led by China Renaissance, Blockworks reported Monday. This values the Hong Kong-based company at $1 billion. 

We’re watching out for …

  • Federal Reserve Chair Jerome Powell testifies at a House Subcommittee hearing on Tuesday.
  • Bank of England interest rate decision will take place on Thursday.
  • PCE price index will be released on Friday.

That’s it for today’s markets wrap. I’ll see you back here tomorrow.

Tags

Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

Mon - Wed, March 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience: Attend expert-led panel discussions and fireside chats Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts.

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Top Icon.png

Research

Osmosis thrived in H2 2023 on the back of increased DeFi activity deriving from recently launched Cosmos-related projects and better market conditions. With new value accrual mechanisms for the native token, Osmosis is well-positioned to continue its strong performance in 2024.

/

article-image

Though the opposing flow trend is likely to slow over time, industry watchers note, bitcoin fund assets could one day eclipse the $90 billion gold ETF space

article-image

Celestia had the first mover advantage. EigenDA has staked ether. What sets Avail apart?

article-image

Bitcoin moved 1% higher Monday morning in New York, Matrixport analysts say $62,000 could happen next month

article-image

It’s hard to believe right now that crypto — even with all of its flexibility and massive capabilities — could ever be like cash on the internet

article-image

Michael Saylor announced Monday morning that MicroStrategy bought 3k more bitcoin after the X account was compromised over the weekend

article-image

Plus, Pudgy Penguins grows its brand and a group of Autoglyphs sell for $14.5 million