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Weekly Market Report

24 Feb 2020

24 February 2020

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The Market Last Week

Global equities ended lower last week, amid rising concerns about the impact of the coronavirus epidemic on global economic slowdown.


UK Markets ended the week in negative territory, amid uncertainty related to the Brexit trade talks and growing fears over the spread of coronavirus in China and neighbouring countries.

UK’s Markit services PMI fell to a two-month low level in February.

Average hourly earnings rose less-than-expected in the three months to December.

The consumer price index (CPI) climbed to its highest level in six months on an annual basis in January.

The Markit manufacturing PMI unexpectedly advanced at its fastest pace in 10 months in February.

The ILO unemployment rate remained unchanged in the three months to December, hitting its lowest since early 1975.

The retail price index climbed on a yearly monthly basis in January.

The producer price index (PPI) rose more than market expectations on a yearly basis in January.

The DCLG house price index jumped more than market forecast on an annual basis in December.

Retail sales rebounded on a monthly basis in January.

The CBI total trend orders increased more than market forecast on a monthly basis in February.




European Markets ended the week on a negative footing, amid ongoing worries about the spread of coronavirus outbreak.

Eurozone’s ZEW survey economic sentiment unexpectedly declined in February.

Eurozone’s construction output dipped on a monthly basis in December.

Current account surplus in the Eurozone widened less-than-anticipated in December.

Eurozone’s consumer confidence index improved in February.

The Markit manufacturing PMI in the Eurozone climbed to its highest level in 12 months in February.

In the Eurozone, the Markit services PMI advanced to a 2-month high level in February.

Eurozone’s CPI rose as expected on a yearly basis in January.

Germany’s ZEW survey economic sentiment dropped more than market forecast in February, marking its lowest level since November.

The ZEW survey current situation index in Germany fell more than market expectations in February.

Germany’s GfK consumer confidence index fell in line with market expectations for March.

The Markit services PMI dropped in February, hitting its lowest level in 2 months.

Germany’s Markit manufacturing PMI jumped to a 13-month high level in February.

The PPI in Germany unexpectedly climbed on a yearly basis in January.

Germany’s Markit services PMI unexpectedly rose in February.




US Markets ended the week in red, after Apple issued a profit warning signalling coronavirus’ threat to global businesses.

The US Markit manufacturing PMI declined more than market forecast in February.

The Markit services PMI fell more than market expectations in February.

The MBA mortgage applications declined in the week ended 14 February 2020.

Initial jobless claims rose in line with market anticipations in the week ended 14 January 2020.

The NY Empire State manufacturing index climbed to a 9-month high level in February.

The NAHB housing market index eased in February.

The PPI rose on an annual basis in January, registering its biggest increase since May 2019.

Building permits jumped to its highest level in nearly 13 years in January.

Housing starts dropped less-than-expected on a monthly basis in January.

The Philadelphia Fed manufacturing index unexpectedly climbed in February.

Existing home sales fell less-than-anticipated on a monthly basis in January.




Asian Markets ended mostly weaker last week, after reports indicated that the coronavirus has spread in South Korea and Japan.

China’s house price index recorded a rise in January.

Japan’s final industrial production advanced on a monthly basis in December.

The CPI rose in line with market expectations on an annual basis in December.

Japan’s total merchandise trade deficit unexpectedly widened in January.

The Jibun Bank flash manufacturing PMI unexpectedly declined in February.

Machinery orders in Japan declined more-than-anticipated on a monthly basis in December.

Australia’s Westpac consumer confidence index improved on a monthly basis in January.

Unemployment rate in Australia rose more than market expectations in January.

The Reserve Bank of Australia (RBA), in its February monetary policy meeting minutes, reviewed the case for further reduction in cash rate and indicated that the board was prepared to ease monetary policy further if required. Further, the RBA reiterated that low interest rates would be required for an extended period to reach full employment and achieve its inflation target. Additionally, officials expressed concerns that coronavirus presented a ‘material risk’ to China’s economy, and thus Australia.




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Currency Update

The EUR ended firmer against the USD last weak, after Eurozone’s manufacturing PMI rose to a 12-month high level in February.
The British Pound ended weaker against the greenback in the prior weak, amid uncertainty surrounding Britain’s trade talks with the European Union and government plans to boost spending.
The US Dollar ended mostly stronger against its major counterparts last week, as mounting worries about the impact of the coronavirus outbreak boosted the safe haven appeal of the currency.


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FOMC signals interest rates to remain unchanged

The Federal Open Market Committee (FOMC), in its January meeting minutes, revealed that interest rates are expected to remain unchanged for some time and expects economic growth to continue at ‘moderate pace’. The minutes reiterated that though trade uncertainties had diminished following the signing of the phase one US-China trade deal, downside risks posed by the outbreak of the coronavirus ‘warranted close watching’.


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The Week Ahead

Going ahead this week, investors will keep a tab on the US gross domestic product, consumer price index, housing price index, durable goods orders, the Michigan consumer sentiment index, trade balance, pending home sales, personal income and spending data along with the UK’s GfK consumer confidence index, BBA mortgage applications, Nationwide house prices and the BRC shop price index for further direction. Also, Eurozone’s CPI, industrial and consumer confidence indices and economic sentiment indicator along with Germany’s GDP, CPI, unemployment rate and the Ifo survey indices will be on investors’ radar.


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