US stocks plunge across the board, Hong Kong's approval of spot ETF does not provide upward momentum for BTC and ETH

Yesterday, the U.S. stock market surged initially but then plummeted. Strong retail sales data deepened the expectation that the Federal Reserve would not rush to cut interest rates. U.S. bond yields surged, and investors also worried about escalating geopolitical tensions between Iran and Israel, leading to a broad decline in U.S. stocks. Bitcoin and Ethereum rose in the afternoon yesterday as news of Hong Kong approving a spot ETF circulated, but later followed the downward trend of the U.S. stock market. As the halving countdown continues, it seems, as predicted by Arthur Hayes, that there will be a decline first, with expectations that it will not show its full potential until May.

Arthur Hayes: Has liquidated SOL and meme coins, waiting to show its strength in May

US Consumer Strength Remains Robust

According to a report by CNBC, the report issued by the US Department of Commerce on Monday showed that rising inflation in March did not deter consumers from shopping at a faster pace than expected. Despite rising interest rates and concerns about stubborn inflation, flexible consumer spending helped sustain economic growth. Consumer spending accounts for nearly 70% of the US economic output, making it crucial for the continued growth of the Gross Domestic Product (GDP).

Furthermore, news of layoffs at Tesla, as well as the departure of senior vice presidents responsible for battery technology research and development, and public policy and business development, caused Tesla's stock price to plummet by over 5%, bringing the year-to-date decline to 35%.

However, strong retail sales have reinforced the expectation that the Federal Reserve (Fed) will not rush to cut interest rates, leading to a sharp rise in US bond yields. Investors are also concerned about escalating geopolitical tensions between Iran and Israel. As a result, US stocks ultimately saw a broad decline, with the S&P 500 falling by 1.2%, hitting a two-month low, the Nasdaq dropping by 1.7%, and the Dow wiping out its gains for the year.

Bitcoin Surges Briefly on Approval of Spot ETF in Hong Kong

Bitcoin briefly rose yesterday afternoon after reports emerged that Hong Kong had approved spot Bitcoin and Ethereum futures, but later followed the decline in US stocks, currently trading at $63,299. Bloomberg analyst Eric Balchunas stated that given the relatively small size of the Hong Kong ETF market, about $500 billion, and the small size of the three approved issuers, combined with the inability of mainland China to purchase, at least officially, he estimates that the issuance will only amount to $500 million. He also heard rumors that a Hong Kong Bitcoin spot ETF will be launched next week.

China Huaxia Fund: Approved by Hong Kong regulators, plans to issue Bitcoin and Ethereum spot ETFs.

Ethereum Holds Steady at 3,000

Ethereum's trend is similar to Bitcoin's. This time, Hong Kong has also approved an Ethereum spot ETF, seen as a major bullish factor for ETH since the US has not yet approved an Ethereum spot ETF, and investors cannot obtain Ethereum-related exposure from the stock market as they can with Bitcoin through mining company stocks. However, the market's response seems lukewarm at the moment, with Ethereum trading at $3,096 at the time of writing.