China Two Sessions, gold price

South Korea’s economy clocked a quarter-on-quarter growth of 0.6% during the fourth quarter, according to revised central bank data.

The number was unchanged from the central bank’s advance estimates.

South Korea’s GDP rose 2.2% in the fourth quarter on an annual basis, which was also in line with the advance estimate.

Stocks in the country dipped, with the Kospi down 0.2%.

— Shreyashi Sanyal

Headline inflation in Japan’s capital city of Tokyo accelerated to 2.6% in February compared with the revised figure of 1.8% seen in January.

This is the first time that Tokyo’s inflation rate has risen in three months, rebounding off the 22-month low recorded in January.

Core inflation, which strips out prices of fresh food, came in at 2.5%, in line with expectations from a Reuters poll. The so called “core-core” inflation metric, which strips out prices of food and energy, held steady at 2.5%.

Tokyo’s inflation numbers are widely considered to be a leading indicator of nationwide trends in Japan.

— Lim Hui Jie

Competition is heating up in the electric vehicle industry, especially between investor favorite Tesla and Chinese automakers like the Warren Buffett-backed BYD.

However, one fund manager has some serious reservations about the sector.

“We don’t own any of the [EV] auto manufacturers and I think the arms race to develop EVs is going to be profitless for a lot of these businesses, including Tesla. So, I would avoid it all, I’m afraid,” he added.

The fund manager instead has his sights on what he calls “bigger integrated covers,” naming his favorite alternative stocks.

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— Amala Balakrishner

Prior instances when U.S. stocks have risen this relentlessly (since World War II, anyway) have only come in the wake of either a recession or a “bubble scenario” — and the current market has elements of both, Deutsche Bank macro strategist Henry Allen wrote to clients Monday.

“It’s rare to see a rally this fast, and when they happen it’s usually because the economy is emerging from recession and the stock market has just been through a slump,” Allen wrote, noting that the S&P 500 slumped 19.4% in 2022, its fourth-worst annual performance since 1945. “The only time in post-war history that this wasn’t the case was during the dot com bubble.”

Historically, after strong rallies, what happens next is “the S&P 500 has actually continued to advance over the next 6 and 12 months on every occasion,” Deutsche Bank said. What’s different this time is that the economy never fell into a recession from which it had to recover, at the same as the stock market rally over the past year “has been unusually narrow by historical standards.”

Last year, for example, was the first time since 1998 that the market cap-weighted S&P 500 outdistanced the equal-weighted S&P 500 by more than 10 percentage points, the report noted. Whatever the impetus, with the S&P 500 having advanced in 16 out of the past 18 weeks since the October 2023 low, “it is rare to see such a sustained period of outperformance,” Allen wrote.

— Scott Schnipper

The tech-powered rally has propelled stocks to new heights this year, with all three major indexes notching new closing records in 2024.

UBS sees no end in sight yet for the tech rally — but believes investors would be best suited to diversify their assets.

“With generative AI looking set to be the growth theme of the decade and US large-cap tech companies leading the revolution, we continue to believe that US tech stocks…