Daily Digest:
w/c 15 July - Financials earnings reports kick off the week, then we get Netflix results Thursday. US Retail Sales is the standout macro data this week on Tuesday. We also get the latest ECB interest rate decision on Thursday.

Markets Consolidate into Easter, Ahead of US CPI, Fed Minutes

Intermediate

Macroeconomic/ geopolitical developments

  • A second week with an absence of any notable developments or contagion from the March banking crisis, and again no new news to start April was seen as good news, with fears of a more protracted or deeper financial meltdown further easing.
  • European markets were fully closed on Friday as were US cash equity markets for the Easter Good Friday holiday, though US Bond and futures markets had a partial open session.
  • Despite US markets being closed or partially closed Friday, the US Labor Department released the US Employment report, with the Non-Farm Payroll number coming in at at 236K, close to consensus at 239K and the Unemployment Rate at 3.5%, below expectations at 3.6%.
NFP
  • Earlier in the week US Purchasing Managers Index (PMI) data from the Institute of Supply Management (ISM), saw the Manufacturing index fall to a near three-year low to 46.3, below expectations of 47.5, whilst the Services index posted at 51.2, below consensus of 54.4.
ISM

Global financial market developments

  • The major US stock averages were little changed in a narrow trading range last week, but retain a positive bias from the March rally.
  • European indices were also little changed, consolidating the March recovery.
  • US and European Bond were also in consolidation modes, but with European yields slightly lower for the week and US yields slightly higher.
  • Forex markets were quiet with the US Dollar weakening slightly again.
  • Gold pushed higher to another new 2023 and multi-month high, near to record levels.
  • Oil prices surged on Monday with the price leaping over 8% and held at elevated levels, after the announcement of supply cuts by OPEC+ the prior weekend, close to a multi-month high.

Key this week

  • Geopolitical events: Easter Monday holiday on 10th April, UK and European bond and stock markets are closed, US markets are fully open.
  • Central Bank Watch: Wednesday sees the Bank of Canada (BoC) interest rate decision and statement, and we also get the FOMC Minutes released. From the Fed, Williams speaks Monday., Harker on Tuesday, Kashkari Wednesday and Waller Friday.
fed
  • Macroeconomic data: Key will be the US CPI inflation data  released on Wednesday, for Europe, UK GDP and German CPI are the standouts for the week on Wednesday, then US Retail Sales data is released Friday
inflation
  • Earnings Season: US earnings season kicks off in earnest on Friday with the financial sector, JP Morgan, Wells Fargo, BlackRock and Citigroup all report.
DateKey Macroeconomic Events
10/04/23Easter Monday holiday, UK and European markets are closed; Fed’s Williams speaks
11/04/23China CPI; EU Retail Sales; Fed’s Harker speaks
12/04/23Fed’s Kashkari speaks; US CPI; BoC interest rate decision and statement; FOMC Minutes released
13/04/23Australian Employment report; China trade data; UK GDP Industrial and Manufacturing Production; German CPI; US PPI
14/04/23US Retail Sales; Michigan Consumer Sentiment; Fed’s Waller speaks

Editor in chief

Steve Miley is the Market Chartist and has 32 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Mar... Continued

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