Here's Everything You Need To Know Today

It’s all surprises to the downside today as a bunch of economic figures have printed with much cooler results than expected. The big news is that retail spending dropped 0.8% in January—more than double the decline the market expected. Analysts are now scrambling to understand whether or not consumers in America just held tighter to their cash in the wake of a strong holiday season or if shoppers are finally truly running out of gas.

And then—in another shock: Japan’s economy slipped into a recession. Analysts have been concerned about growth in Japan for a while now—but no one had priced in a full-blown recession yet.

Wildly, this latest GDP report from Japan has also confirmed that Germany has overtaken Japan as the world’s 3rd-largest economy.

While markets aren’t immediately overreacting here, cooling growth worldwide could drag on major markets and this is something to keep an eye on. While slower growth will help cool inflation—The Street will always be worried about interest rates pumping the brakes a little too hard. Because of that—traders hit a moment of equilibrium early today with no consistent winning trend.

So, let’s look at the trends that really are powering the market. Inflation is still hammering some businesses that can’t build more efficient operations fast enough, while other businesses are getting crushed by the very interest rates that are being used to solve inflation. And then there’s the crypto market—which is achieving momentum of its own and building toward escape velocity out of nowhere. There’s a lot to unpack during trading days like today, so let’s zero-in on the bigger dynamics: