A person shops at a supermarket in New York City on December 14, 2022.
Yuki Iwamura | AFP | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
Nikkei ends higher
Japan’s Nikkei 225 closed above 40,000 on Tuesday after the country’s central bank raised interest rates for the first time since 2007. The broader Topix also rose. Hong Kong’s Hang Seng and mainland China’s CSI 300 fell. Overnight, U.S. stocks ended higher with the Federal Reserve’s policy meeting in focus. The S&P snapped a three-day losing streak to gain 0.63%, while the Dow rose 0.2%. The tech-heavy Nasdaq added 0.82%.
BOJ hikes rates in historic move
The Bank of Japan ended the world’s only negative interest rate policy, hiking rates for the first time in 17 years at its March meeting. It also abandoned the yield curve control for 10-year Japanese government bonds and will no longer purchase exchange traded funds and Japanese real-estate investment trusts.
Nvidia’s new AI chips
Nvidia CEO Jensen Huang revealed a new generation of AI chips at the company’s developer’s conference in San Jose, where the chipmaker showcased its latest inroads in the technology. The new AI graphics processors called Blackwell are expected to ship later this year. The announcement comes as the chip giant aims to cement its dominance in the AI market.
Aramco on energy transition
Saudi Aramco CEO Amin Nasser said the current energy transition strategy is failing and the world should give up on the idea of phasing out oil and gas. “Instead invest in them adequately reflecting realistic demand assumptions,” he suggested, as fossil fuel demand is forecast to continue rising in the years ahead.
[PRO] Bullish on Palantir
Brian Stutland of Equity Armor Investments calls Palantir a “promising AI investment” and a “serious player” in the space. “They’re doing more than just their cybersecurity for the government. They are really starting to become very creative in the AI world,” he said of the company, known for its government contract work in defense and intelligence.
The bottom line
American consumer sentiment seems to be holding steady even as inflation concerns linger.
The closely watched University of Michigan’s reading came in at 76.5 in March, slightly below consensus.
“After strong gains between November 2023 and January 2024, consumer views have stabilized into a holding pattern; consumers perceived few signals that the economy is currently improving or deteriorating,” said Joanne Hsu, the survey’s consumers director.
The survey’s one-year inflation expectations were unchanged at 3.0% in March and inflation outlook for the long-term was steady at 2.9% for the fourth straight month.
Still, there are worrying signs consumer spending could be slowing down amid sticky inflation and high borrowing costs.
Retail sales rose less than expected at 0.6% in February while January’s decline was revised even lower to 1.1%.
“It is increasingly evident that after years of a devil-may-care approach to spending, consumers have at last shown signs of being more reserved at the start of this year,” Wells Fargo said in a note last week.
The latest Bank of America report also showed inflation is taking a toll on Americans as card spending was weak in February.
“More broadly, retail (i.e., goods and food services) spending has been slowing down over the last few quarters, as goods inflation has fallen sharply and services inflation has remained elevated,” the bank said.
“The risk is that sticky services inflation will further shrink retail’s wallet share, to the extent that real spending also slows down.”
— CNBC’s Lisa Kailai Han contributed to this report