On Monday, China reported that 2020 GDP rose by +2.3%. The Trump administration warned about selling to restricted Chinese manufacturers. Asian markets were mixed. After falling -0.97% on Monday, the Nikkei 225 jumped +1.39% today. While the Shanghai Composite was up +0.84% on Monday, today it gave back -0.83%. European markets were stronger across the board. The DAX gained 0.77%. 10-yr Bunds yield -0.531%. The MBA Mortgage Applications Index for 01/16 eased back slightly as rates firmed, printing at -1.9%. The January NAHB Housing Market Confidence Index declined for the 2nd month in a row, printing at 83. Levels above 50 indicate improving confidence. 10-Year Notes yield 1.08%. The March US$ Index was fractionally lower by -0.01% to 90.465. February gold jumped by +1.57% to $1,873.00. March crude edged up +0.19% to $53.08. Joe Biden was inaugurated as President today. Shares of Netflix hit an ATH, driving the Nasdaq index to another record high. Morgan Stanley grew net income by 50% YoY. With more fiscal stimulus on the horizon, and continued dovish Fed policies, the major indices soared to record highs.

On Monday, China reported that 2020 GDP rose by +2.3%. The Trump administration warned about selling to restricted Chinese manufacturers. Asian markets were mixed. After falling -0.97% on Monday, the Nikkei 225 jumped +1.39% today. While the Shanghai Composite was up +0.84% on Monday, today it gave back -0.83%. European markets were mixed on the prospect of longer lockdowns. The DAX was down -0.24%. 10-yr Bunds yield -0.528%. There were no major economic reports scheduled. Senate hearings began on Biden cabinet nominations. 10-Year Notes yield 1.089%. The March US$ Index fell -0.30% to 90.480. February gold added +0.49% to $1,839.10. March crude jumped +1.13% to $53.01. GM received $2B from Microsoft and hit an ATH. Goldman Sachs surged after profit and revenue expectations were smashed. Treas. Sec. nominee Yellen spoke before the Senate Finance Committee, emphasizing her commitment to use government and stimulus to “act big” regarding the economy and social issues. The ES was stronger overnight and never looked back. All the major indices gained back the ground lost last week.

The Trump administration added Chinese smartphone maker Xiaomi to its expanding blacklist. Asian markets were mostly lower. The Nikkei 225 fell -0.62% and the Shanghai Composite edged up +0.01%. Pfizer said EU vaccines will be delayed. European markets sank. The DAX lost -1.75%. 10-yr Bunds yield -0.541%. Nov. Business Inventories were 0.5% vs. 0.4% consensus. Dec. PPI rose +0.3% (ex-food and energy +0.1%). For the 3rd consecutive month, Retail Sales fell, off -0.7% (ex-vehicles -1.4%), Industrial Prod. jumped +1.6%, and Capacity Utilization rose to 74.5%. The Jan. Empire State Mfg Survey slipped to 3.5 and preliminary Consumer Sentiment printed at 79.2 vs. consensus of 80.7. Baker-Hughes reported that the U.S. oil rig count for 01/09 at 360, up 9. 10-Year Notes yield 1.083%. The March US$ Index jumped +0.63% to 90.780. February gold slid -1.33% to $1,826.80. February crude lost -2.80% to $52.05. Biden’s stimulus plan, along with quarterly earnings from major banks, turned out to have a “sell the news” tone. Early in the day, the major indices sold off and finished deeply red.