Market Performance on Monday
The S&P 500 Index ($SPX) closed up by +0.54% on Monday, while the Dow Jones Industrial Index ($DOWI) rose by +1.05%. The Nasdaq 100 Index ($IUXX) experienced a gain of +0.73%. March E-mini S&P futures (ESH26) increased by +0.57%, and March E-mini Nasdaq futures (NQH26) were up by +0.76%.
Positive Manufacturing Data
U.S. stock indexes ended higher due to positive indicators from U.S. manufacturing, following the release of January’s ISM manufacturing index, which showed significant growth—its best performance in over three years. This boost was further supported by gains in semiconductor and AI-related stocks.
ISM Manufacturing Index Insights
In January, the ISM manufacturing index rose by +4.7 points to reach 52.6, surpassing forecasts of 48.5 and marking the most robust expansion in over three years. However, comments from Atlanta Fed President Raphael Bostic, indicating that the Fed may need to maintain restrictive interest rates without any expected cuts for the foreseeable future, weighed on stock sentiments.
Energy Sector Challenges
The energy sector faced challenges as WTI crude oil prices dropped by over 4%, influenced by reduced geopolitical tensions after President Trump indicated discussions with Iran, which alleviated concerns regarding potential conflict.
Cryptocurrency Market Reactions
On Monday, the cryptocurrency market saw declines as Bitcoin (^BTCUSD) plummeted more than -7% to a low not seen in nearly ten months. Reports from Coinglass noted that approximately $590 million in long Bitcoin positions were liquidated over the weekend.
Global Economic Concerns
Weaker economic data from China, with the Shanghai Composite Index falling over -2% to a four-week low, is raising concerns about global growth. China’s January manufacturing PMI unexpectedly declined, suggesting ongoing challenges in the region.
Upcoming Economic Focus
This week, market attention will be directed towards tariff developments, earnings reports, and economic indicators. Key releases include the January ADP employment change, expected to see an increase of +45,000, and the January ISM services index, which is forecasted to decrease to 53.5.
