Global equity markets ended mixed last week. UK markets ended the week in positive territory, buoyed by gains in financial and mining sector stocks. On the data front, UK’s Halifax house prices advanced more than market expectations on a monthly basis in March. Further, the trade deficit narrowed more than market forecast in February. Meanwhile, the nation’s NIESR gross domestic product estimate recorded a less-than-anticipated rise in the three months ended March. Additionally, industrial production rose less than expected on a monthly basis in February and monthly manufacturing production surprisingly dropped in the same month, marking its first decline since March 2017. European markets ended the week on a positive footing, led by gains in automobile sector stocks. Data indicated that Eurozone’s seasonally adjusted trade surplus unexpectedly widened in February. On the contrary, the region’s industrial production unexpectedly fell on a monthly basis in February, marking its largest decline since the end of 2016. Furthermore, the Sentix investor confidence index dropped more-than-anticipated in April. Separately, Germany’s final consumer price index came in line with market expectations in March. Meanwhile, the nation’s trade surplus widened less than market anticipations in February. US markets ended the week in the red, as deepening geopolitical tensions dented investor sentiment. On the macroeconomic front, the US monthly budget deficit narrowed less than market expectations in March. Additionally, the MBA mortgage applications fell to a seven-week low in the week ended 6 April 2018. Moreover, the Michigan consumer sentiment index declined to a three-month low level in April, amid ongoing trade war fears. Further, the JOLTS job openings fell less than market anticipations in February. Meanwhile, the nation’s producer price index (PPI) recorded a more-than-expected advance on a yearly basis in March. Additionally, the consumer price index (CPI) rose at par with market expectations on an annual basis in March, marking its fastest gain in one year. Asian markets ended mostly weaker last week.


Currency Update


The EUR ended higher against the USD, after the European Central Bank (ECB) President, Mario Draghi, expressed confidence in the common currency region and stated that the economic growth would remain strong. Also, hawkish comments from the European Central Bank (ECB) policymaker, Ewald Nowotny further boosted the currency. The British Pound ended stronger against the greenback, following bullish comments from the Bank of England policymaker, Ian McCafferty. The US Dollar ended lower against its major counterparts last week, amid rising tensions over Syria and Russia.



Fed Minutes: Positive outlook on the US economy and inflation


As per the Federal Reserve’s (Fed) March meeting minutes, policymakers broadly agreed that the US economy is growing at a higher pace while inflation picked-up in recent months. Additionally, the minutes reported that the central bank remains on track for a gradual path of policy tightening, but a few officials expressed concerns that rising inflation may call for a faster pace of interest rate hike.



The Week Ahead


Going ahead this week, market participants will closely watch the Reserve Bank of Australia’s April meeting minutes, Australia’s unemployment rate and NAB business confidence index along with Japan’s industrial production, trade balance and CPI for further direction. Further, the US advance retail sales, the NAHB housing market index, the MBA mortgage applications, initial jobless claims, industrial and manufacturing production along with UK’s claimant count rate, ILO unemployment rate, CPI, PPI and house price index will be on investors radar. Also, Eurozone’s CPI, current account balance and consumer confidence index along with Germany’s ZEW survey indices and PPI will attract investor attention.



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