Bitcoin Closes at $77,991.89 as Tech Stocks Fall and US Economic Indicators Diverge
Key Facts
Bitcoin closed at $77,991.89 on October 29, according to EL7 data, after falling below $80,000 during a decline that extended to other cryptocurrencies. CoinDesk said weakness in equities weighed on Bitcoin, Ether, XRP, Solana and several other coins. This coincided with a drop in technology stocks in the United States and Asia, amid investor concerns about returns on heavy spending on artificial intelligence. The Associated Press said Alphabet's purchases of property and equipment exceeded $51 billion in the third quarter. The company's share-price decline renewed investor questions about whether AI investments will pay off.
Alphabet Class A shares fell 12.6% on October 29, their worst daily performance since they began trading more than 20 years ago, according to the Associated Press. The Nasdaq Composite closed down 1.4%, while the S&P 500 and Dow Jones each lost 0.3%. Samsung shares also fell 4.1% in the session, despite higher company profits, the agency reported. Samsung said strong demand for servers had lifted market prices across applications, and its memory business posted record quarterly revenue and operating profit. Technology-stock losses added a risk-off backdrop to trading as Bitcoin and other cryptocurrencies fell.
On October 28, the Federal Reserve kept its target rate range at 3.75% to 4%, in a decision approved by a 10-to-2 vote. Lisa Cook and Beth Hammack dissented, preferring to raise the range by 0.25 percentage point. The central bank said economic activity “continues to expand at a solid pace” and inflation “remains elevated,” citing its 2% target. The decision comes as US gross domestic product growth accelerated and annual inflation, as measured by the personal consumption expenditures price index, rose. This divergence puts growth and price data at the center of attention on the monetary policy outlook.
US real gross domestic product grew at an annual rate of 3.4% in the third quarter, compared with 2.2% in the second quarter, according to the advance estimate from the US Bureau of Economic Analysis. Increases in investment, consumer spending and government spending contributed to growth, partly offset by a decline in exports. Meanwhile, the year-over-year change in the personal consumption expenditures price index rose to 3.6% in September from 3.4% in August. The figures place stronger growth alongside accelerating inflation, as the Fed says inflation remains elevated. The bureau is scheduled to release its next GDP estimate on November 25, ahead of the Fed meeting scheduled for December 8 and 9.
US spot Bitcoin funds attracted $137 million on October 28, according to SoSoValue data cited by Cointelegraph. The inflows brought the total over three consecutive days to about $424 million. The inflows came before Bitcoin closed at $77,991.89 on October 29, after falling below $80,000. The simultaneous inflows and decline highlight diverging signals between fund activity and price performance during that period. The upcoming GDP data and the Fed's December meeting remain scheduled events on the near-term economic calendar.