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Canada CPI prices, Microsoft surpasses Apple for the first time

This is a repeat achievement for Microsoft from two years ago.

Canada’s Prices up to 3.4% YoY. Microsoft surpasses Apple. Asian markets dip, U.S. cautious despite Fed rate cut expectations

North American Economic Overview

Canada CPI Data

Consumer Price Index and main benchmarks

Canada’s CPI rose by 3.4% year-over-year in December, up from 3.1% in November. Gasoline prices contributed to the acceleration, but excluding gasoline, the CPI slowed to 3.5% year over year. Airfares, fuel oil, passenger vehicles, and rent influenced the additional acceleration, while food prices remained stable at a 4.7% increase for both months.

Gasoline and Transportation prices

Gasoline prices rose 1.4% in December due to a base-year effect, following a 7.7% decline in November. Monthly gasoline prices continued their decline by 4.4%, driven by uncertainty in oil demand. Air transportation costs surged by 31.1% on a monthly basis, positively impacting the all-items CPI.

Housing and Rent Prices

Rent prices rose by 7.7% year-over-year in December. Factors include a higher interest rate environment and barriers to homeownership. Most provinces experienced elevated rent prices, with Ontario, British Columbia, and Quebec contributing the most.

Passenger Vehicles

The purchase of passenger vehicles index rose by 2.3% year-over-year in December, driven by higher prices for new passenger vehicles (+3.4%).

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United States and Global Market Prices

Wall St Indices

Wall Street started lower after the holiday weekend, with S&P 500 and Dow Jones futures slipping 0.3% and 0.2%. Investors’ optimism about Federal Reserve interest rate cuts is tempered by concerns about the timing and extent of such cuts.

Microsoft dethrones Apple

Microsoft took Apple’s crown with a market cap of $2.89 trillion.
In Europe, Germany’s DAX and France’s CAC40 declined by 0.3%, while Britain’s FTSE 100 slipped by 0.2%.

Markets Prices in Asia

In Asian trading, Tokyo’s Nikkei 225 fell by 0.8%, ending its winning streak. The Hang Seng in Hong Kong fell by 1.9%, and the Shanghai Composite index recovered to add 0.3%.

China’s Economic Concerns

China is set to provide an economic update, with forecasts indicating annual growth at 5.3% in the last quarter. Concerns persist about a potential significant decline in growth rates, with IMF head Kristalina Georgieva warning of growth falling under 4% unless reforms stimulate spending.

Oil Prices and Currencies

Benchmark U.S. crude oil rose by 34 cents to $73.02, while Brent crude climbed to $78.83 per barrel. The dollar weakened against the Japanese yen, reflecting concerns over the Bank of Japan potentially ending its negative interest rate policy.

Market and Corporate Earnings

Investor Sentiment

U.S. stock index futures slipped, led by losses in Tesla and Apple shares. Investors are assessing earnings reports from Goldman Sachs and Morgan Stanley for insights into capital markets and dealmaking. Optimism about a Federal Reserve rate cut in March is tempered by concerns about the timing of such cuts.

Corporate Earnings and Tech Stock Prices

Goldman Sachs reported a 51% rise in profit, benefiting from a market recovery, while Morgan Stanley’s profit dropped due to one-time charges. Tech giants Tesla and Apple faced losses in premarket trading. Tesla’s CEO expressed discomfort about growing the company’s AI and robotics leadership without significant voting control.

More Fed Rate Cut Expectations

Despite mixed inflation data, investors continue to price in a 70% chance of a Federal Reserve rate cut in March. Economic data, including December retail sales, industrial production, and housing data, are anticipated throughout the week and will influence investor decisions.

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