• U.S. Advance Q4 GDP estimate showed economic output increased at an annualized rate of 2.6% (consensus 2.2%). With the fourth quarter numbers, it is estimated that real GDP increased 2.9% in 2018 versus 2.2% in 2017. The key takeaway from the report is that it supported the notion that the U.S. economy held up relatively well in the fourth quarter despite the stock market volatility. In turn, it will help rebut any notions that the economy is on the cusp of a recession.
• Initial claims for the week ending February 23 increased by 8,000 to 225,000 (consensus 221,000). Continuing claims for the week ending February 16 increased by 79,000 to 1.805 million.The key takeaway from this report is that the low level of initial claims, which have held below 300,000 for 208 consecutive weeks, continues to support the view that the labor market remains tight and that employers are reluctant to let go of employees.
• Chicago PMI, increased to 64.7 in February (consensus 57.5) from 56.7 in January.  The New Orders Index rebounded swiftly from a two-year low to its highest level since November.
• Media attention was placed on Trump abruptly ending a two-day summit with North Korean leader Kim Jong-un. Trump hoped to curb Pyongyang’s nuclear-weapons program, but communication broke down when North Korea wanted the U.S. to lift all sanctions in exchange for closing some, but not all, of its nuclear sites. North Korea later refuted this account. 
• U.S. Treasuries finished lower following the release of the better-than-expected advance Q4 GDP reading. The 2-yr yield increased one basis point to 2.50%, and the 10-yr yield increased two basis points to 2.71%. The U.S. Dollar Index increased 0.1% to 96.22. WTI crude rose 0.5% to $57.22/bbl.

• S&P 500 lost -0.28% on Thursday in another tight-ranged session, which included the underperformance of cyclical sectors and the outperformance of defensive-oriented sectors. Investors also weighed better-than-expected GDP data, the latest batch of earnings reports, and some geopolitical drama.
• The S&P 500 materials (-1.3%), energy (-1.0%), and consumer discretionary (-0.6%) sectors underperformed the broader market. Conversely, the utilities (+0.4%), consumer staples (+0.3%), and real estate (+0.3%) sectors outperformed
• Booking Holdings (BKNG 1697.04, -208.90, -11.0%), HP Inc. (HPQ 19.73, -4.12, -17.3%), Box (BOX 20.24, -4.64, -18.7%), and Crocs (CROX 25.68, -2.84, -10.0%) dropped considerably following their reports. Anheuser-Busch InBev (BUD 78.16, +3.44, +4.6%) and Monster Beverage (MNST 63.83, +5.09, +8.7%), however, pleased investors with their results.

• Particular attention during the U.S. session was placed on congressional testimony from Fed Chair Jerome Powell, U.S. Trade Representative Robert Lighthizer, and Trump’s former personal lawyer, Michael Cohen.
• Powell in his semi-annual monetary policy acknowledged the Fed is close to agreeing on a plan to end the balance sheet runoff. USTR Lighthizer said that it is too early to predict the outcome of the U.S.-China trade negotiations. The views expressed by Cohen before the House Committee on Oversight and Reform ultimately had little, if any, impact on the market.
• Trump began a two-day meeting with North Korean leader Kim Jong Un in Vietnam, hoping to take steps toward denuclearizing North Korea. Separately, Pakistan shot down two Indian fighter jets over their contested border, escalating tensions between the two countries.
• U.S. Treasuries were under pressure, driving yields higher in a curve-steepening trade. The 2-yr yield increased three basis points to 2.51%, and the 10-yr yield increased six basis points to 2.69%. The U.S. Dollar Index increased 0.2% to 96.15. WTI crude rose 2.4% to $56.94/bbl following some bullish inventory data.

• The S&P 500 lost -0.05% on Wednesday as investors weighed a handful of headlines on the political, monetary, and geopolitical fronts, as well as the latest batch of earnings reports.The benchmark index was down as much as -0.7% in early trading action but climbed back to its flat line in the afternoon, where it faced some continued resistance near the 2800 level.
• The outperformance from retail stocks supported an intraday rebound. Better-than-expected results from Lowe’s (LOW 107.62, +2.59, +2.5%), TJX (TJX 51.56, +1.84, +3.7%), and Best Buy (BBY 68.82, +8.51, +14.1%) sparked a retail rally, evidenced by the SPDR S&P Retail ETF (XRT 46.08, +0.46) gaining 1.0%. On the other hand, disappointing earnings and/or guidance from several companies, including Weight Watchers (WTW 19.37, -10.20, -35.5%) and Mylan N.V. (MYL 26.01, -4.61, -15.1%), helped keep a lid on the broader market.

• Housing starts declined 11.2% month-over-month in December to a seasonally adjusted annual rate of 1.078 million (consensus 1.254 million). Building permits were up 0.3% month-over-month to a seasonally adjusted annual rate of 1.326 million (1.290 million).
• The Conference Board’s Consumer Confidence Index jumped to 131.4 in February (consensus 125.0) from an upwardly revised 121.7 (from 120.2) in January. The February reading broke a string of three consecutive monthly declines in the index.
• The key takeaway from the report is that consumers’ attitude about the outlook improved greatly, coinciding with the sharp improvement in the stock market, continued strength in the labor market, and the end of the partial government shutdown. That upbeat outlook should be a supportive factor for consumer spending.
• Powell delivered his semi-annual testimony on the economy to the Senate Banking Committee. The market’s response was relatively muted, as he maintained the Fed’s “patient” approach to monetary policy and balance sheet normalization and did not introduce any “new” views that could have been construed as hawkish. 
• U.S. Treasuries saw increased buying interest, which drove yields lower across the curve. The 2-yr yield decreased three basis points to 2.48%, and the 10-yr yield decreased four basis points to 2.64%. WTI crude decreased 0.3% to $55.60/bbl.
• Sterling caught strong bids on renewed market confidence that a hard-Brexit exit from the EU was not going to happen. Two events yesterday helped fuel the rally. One was the formal call by Labor party leader Jeremy Corbyn for a 2nd Brexit referendum and the other were reports that PM May would consider extending the deadline if her Brexit negotiated deal could not pass Parliament.

• The S&P 500 decreased -0.08% as it struggled for direction on Tuesday. The stock market wavered between small gains and losses while investors weighed mixed economic data, key corporate news, and comments from Powell.
• The S&P 500 materials (-0.6%), health care (-0.3%), and industrial (-0.3%) sectors underperformed the broader market. Conversely, the information technology (+0.2%), consumer discretionary (+0.2%), and communication services (+0.1%) sectors outperformed.
• Home Depot’s (HD 188.30, -1.68, -0.9%) weaker-than-expected FY20 earnings guidance, and December housing starts increasing at the slowest pace (1.078 million) since September 2016, helped stir early concerns about a slower pace of economic, and earnings, growth unfolding in the months ahead, particularly for companies with close ties to the housing market. Caterpillar (CAT 137.98, -3.43, -2.4%) was another drag on the market following a “double” downgrade to ‘Sell from ‘Buy’ at UBS. UBS also lowered its price target to $125 from $154, citing a belief that 55% of the company’s end markets will peak in 2019, pressuring revenue and margins in 2020.

• In U.S.-China Trade Deal, speculation has now shifted from an extension to a conclusion of the trade war. Memorandums of understanding are being drafted in 6 key areas that include cyber theft, intellectual property, currency and non-tariff barriers.
• Assuming that both sides continue to make progress, Trump says they will be planning for a Summit at Mar-a-Lago to conclude an agreement.
• U.S. Treasuries closed on a lower note, pushing yields higher across the curve. The 2-yr yield increased three basis points to 2.51%, and the 10-yr yield increased two basis points to 2.67%. The U.S. Dollar Index declined -0.1% to 96.42. WTI crude lost -3.1% to $55.45/bbl.
• Sterling extended its gains after Prime Minister May delayed the “meaningful vote” to March 12, two weeks before they are scheduled to leave the European Union. Investors believe that by running down the clock, May leaves Parliament with no choice but to take over the Brexit process. She’ll have to request for an extension of Article 50 or risk being shut out of negotiations. 
• Canadian dollar was the only major currency that failed to benefit from the bid in risk appetite. Crude tumbled more than -3% after a tweet from Trump that simply said “Oil prices getting too high. OPEC, please relax and take it easy. World cannot take a price hike – fragile!”

• S&P 500 advanced as much as 0.8% on Monday after Trump said he will delay the March 1 trade deadline as negotiations with China have progressed favorably. The benchmark index, however, steadily retreated throughout the session, ultimately finishing higher by 0.12%.
• Trump followed up with a tweet during late trading action that U.S.-China talks are in advanced stages, but he did not provide a new deadline or any further details. Still, growing expectations for a trade deal underpinned the leadership from the S&P 500 cyclical sectors. Shares of semiconductor companies, many of which have revenue exposure to China, also outperformed and helped lift the heavily-weighted tech sector. The Philadelphia Semiconductor Index increased 0.8%.
• General Electric (GE 10.82, +0.65, +6.4%) gave the industrial sector a boost after it agreed to sell its biopharma business to Danaher (DHR 123.15, +9.67, +8.5%) for $21.4 billion, which includes $21 billion in cash. General Electric had surged 15.5% in the opening minutes of trading but, like the broader market, finished near its session low.

BLOCKCHAIN & CRYPTOCURRENCY NEWS

Coinbase Pro Adds Support for XRP
Coinbase Pro, the professional offering of United States-based crypto trading platform and wallet service Coinbase, is adding support for Ripple’s XRP token. Per the announcement Coinbase Pro will now accept deposits of XRP for a minimum of 12 hours before enabling full trading. Coinbase notes that it will first establish sufficient liquidity on the platform, opening trading pairs in U.S. dollars, euro and Bitcoin (BTC) in phases. Full trading of XRP will be available to customers in the U.S., Canada, the European Union, the United Kingdom, Singapore and Australia. Coinbase may expand its services to other countries at a later time. XRP trading will go through four stages, which include “transfer-only,” “post-only,” “limit-only,” and “full trading. The first two stages will enable users to transfer XRP to Coinbase Pro accounts and post limit orders, the subsequent two will allow customers to match limit orders and fully trade with XRP. The addition of XRP to Coinbase has been long-awaited by the crypto community.

Bitfinex’s Stolen Funds Partially Recovered and Returned by US Law Enforcement
The United States’ law enforcement recovered and returned over $104,000 stolen from the cryptocurrency exchange Bitfinex. The funds returned are reportedly just under 27.7 Bitcoins (BTC), which were stolen in August 2016 in a hack that involved the theft of around 120,000 BTC in total. Bitfinex reportedly generalized the losses across all accounts and credited BFX tokens, one per every dollar lost, to those affected by the hack. These tokens could be redeemed for one dollar each or exchanged for the company’s stocks. The holders who chose to convert into stocks also received Recovery Right Token (RRT) tokens, while all BFX tokens were then destroyed. Since some of the stolen coins have been received, Bitfinex notes that they are now reportedly being converted to U.S. dollars and paid to RTT holders.

Accenture Works With Mastercard, Amazon to Boost Circular Supply Chain Using DLT
Global professional services firm Accenture is working with major global firms including Mastercard to introduce a blockchain-based circular supply chain. An active user of blockchain and digital ledger technology, Accenture now intends to employ the tech as a key component to boost the circular supply chain. The term circular supply chain encompasses all stages on the supply chain, from the beginning to the end, in order to eliminate waste and improve sustainability for the environment. Within the announced initiative, Accenture is collaborating with major global companies including cloud computing firm Amazon Web Services, blockchain supply chain firm Everledger, international development organization Mercy Corps and multinational financial services corporation Mastercard. According to the release, the new blockchain-enabled circular supply chain capability will allow customers to identify small-scale suppliers and growers on the supply chain and make rewards by using direct payments. Additionally, the new capability is designed to provide better management of inventory and waste elimination, transparency across the supply chain and authenticity of products.