Markets Overview

  • ASX SPI 200 futures little changed at 7,105.00
  • Dow Average down 0.1% to 33,588.48
  • Aussie up 0.8% to 0.6934 per US$
  • U.S. 10-year yield fell 4.6bps to 3.5119%
  • Australia 3-year bond yield fell 14 bps to 3.34%
  • Australia 10-year bond yield fell 9.6 bps to 3.72%
  • Gold spot up 0.5% to $1,874.94
  • Brent futures up 1.5% to $79.74/bbl

Economic Events

A rally in stocks fizzled out after two Federal Reserve officials signaled that interest rates could top 5%, throwing some cold water on traders who saw a peak below that mark.

The S&P 500 failed to stay above the key 3,900 level, erasing an advance that reached almost 1.5% earlier in the session. The Dow Jones Industrial Average underperformed, while the Nasdaq 100 remained higher thanks to gains in big tech, with Tesla Inc. surging about 6%. The dollar pared losses.

Fed Bank of San Francisco President Mary Daly said she expects the central bank to raise rates to somewhere over 5%. Her Atlanta counterpart Raphael Bostic noted that policymakers should hike above 5% by early in the second quarter and then go on hold for “a long time.”

Investors also awaited Thursday’s US CPI report that will come out almost a week after the latest jobs data showed that wage growth has decelerated. The figures will be among the last such readings policy makers will see before their Jan. 31-Feb. 1 gathering.

Other News

An Ohio man who was photographed lounging in a bathtub full of dollar bills pleaded guilty Friday to the theft of millions of dollars of Bitcoin from a computer device seized by the government in a money-laundering case against his older brother.

Gary Harmon, 31, told a federal judge in Washington, DC, that he used his brother’s credentials to recreate eight Bitcoin wallets stored on a device in an Internal Revenue Service evidence locker in April 2020. As authorities watched helplessly, Harmon swiped 713 digital tokens valued at about $4.9 million. They’re now worth more than twice that amount.

The Bitcoin was among 4,877 digital tokens seized from his brother, Larry, who was charged in February 2020 with laundering $311 million in crypto transactions on Darknet sites where illegal drugs were sold. Larry Harmon faced the first charges related to mixing, the practice of jumbling together tokens from different owners to make them harder to trace.

After the Bitcoin vanished from the device held by the IRS, Gary Harmon started living large. A photo on his cellphone showed him grinning in a tub full of cash at a nightclub. Agents traced 519 of the stolen Bitcoin through two mixers, filings show. Prosecutors say he used 68 Bitcoin as collateral for a $1.2 million loan, and spent some to buy a luxury condo in Cleveland.

Harmon’s sentencing is scheduled for March 17. His estimated range of potential prison time, which is usually spelled out in a plea agreement, is unclear. He could face 51 to 78 months, depending on how US District Judge Beryl Howell rules on whether he used “sophisticated means” to commit his crimes and whether the obstruction element boosts the range.

The judge won’t decide what his range is until sentencing, and has discretion to go above or below the range.

Howell had continued the plea hearing from last month after she raised a question about how the obstruction applied.

Harmon will remain in jail until he’s sentenced. He appeared in court wearing a dark green jumpsuit indicating he’s being held at a jail in Alexandria, Virginia. He said little during the hearing and appeared calm, and shook his lawyer’s hand before being taken back into custody. He’s been in jail since his arrest in June 2021.

Harmon’s lawyer Ned Smock and assistant US attorneys Christopher Brown and C. Alden Pelker declined to comment following Friday’s plea.