On 30 March, 2016 – A positive day for shares

Most global stocks rallied on Fed Chair Janet Yellen’s remarks on Tuesday.
United States

US stocks rallied for a third day while the US currency continued its retreat lower. The Dow Jones industrials added 0.5 percent while the S&P was 0.4 percent higher. Shares were helped for a second session by Fed Chair Janet Yellen’s remarks Tuesday as she eased anxiety about potential interest rate increases.
MetLife and other financial stocks led the market higher while the S&P energy sector was down marginally after crude prices retreated from their day’s highs after a report showed a weekly build in US crude inventories. MetLife gained after a court ruled that the life insurer was not systemically important to the country’s financial system. The tag “too big to fail” requires more stringent regulations. Fellow insurers AIG and Prudential Financial also advanced. Apple was up on a broker upgrade. Carnival climbed after it reported first quarter results that were better than expected and the company raised its profit projections for the year. Royal Caribbean Cruises also was up on the day.
Norfolk Southern rose after the company said it was open to a possible sale to Canadian Pacific, but only if Canadian Pacific offered a better price and regulators approved the structure of the deal. Norfolk Southern has rejected three offers from Canadian Pacific worth about $30 billion. Wells Fargo and JPMorgan were higher. Acadia Pharmaceuticals rose after a Food and Drug Administration panel made a positive recommendation for Acadia’s drug Nuplazid. Drive-in restaurant chain Sonic rose after the company posted strong results in its fiscal second quarter. Lululemon gained after the company reported strong fourth quarter sales. Verint Systems, a company that makes software used to analyze intercepted communications, dropped after the company’s profit and sales fell far short of estimates.
According to ADP, private payrolls increased 200,000 in March.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was up US$10.25 to US$1,236.25. Copper futures were down 1.1 percent to US$2.19. WTI spot crude was down 1 US cent to US$38.27. Dated Brent spot crude was up 6 US cents to US$39.20. The US dollar was down against the euro, yen, Swiss franc and the Canadian and Australian dollars. It was unchanged against the pound. The Dollar Index was down 0.5 percent. The yield on US Treasury 30 year bond was up 5 basis points to 2.65 percent while the yield on the 10 year note was up 2 basis points to 1.82 percent.

Europe
European markets rallied Wednesday, as investors had their first opportunity to react to Tuesday’s cautious comments from Federal Reserve Chair Janet Yellen. The comments triggered a weakening of the US dollar. The FTSE and DAX added 1.6 percent, the CAC advanced 1.8 percent and the SMI was 0.6 percent higher.
Negative interest rates are not the main policy tool of the European Central Bank for boosting inflation and growth and they will not be lowered deeper into “absurdly” negative territory though further moves cannot be ruled out according to ECB Executive Board Member Benoit Coeure. In an interview with Politico, which was published on the ECB website Wednesday, Coeure said banks have improved their interest margin amid stronger credit demand and lower risk. Coeure maintained that the ECB still had several tools to boost inflation and support economic growth even after a slew of measures announced earlier this month that included a reduction to all of its main three interest rates and a new long term refinancing operation.
Metro soared after saying it plans to split into two companies. E.ON, RWE, ThyssenKrupp and Salzgitter rallied. Alstom climbed after the speed train maker unveiled its strategy and objectives for 2020 with the aim to increase sales by around 5 percent a year by 2020. Carrefour after São Paulo-based Península acquired an additional 2.98 percent stake in the supermarket chain. Technip and Total gained. Premier Foods jumped after McCormick increased its offer for the UK food manufacturer. GlaxoSmithKline was up on a broker upgrade. Mining stocks including Anglo American, Rio Tinto, BHP Billiton, Glencore and. Antofagasta rebounded after Tuesday’s weak performance.
Eurozone economic sentiment fell to its lowest level in more than a year in March, despite additional easing measures taken by the European Central Bank to tackle the deflation treat and stimulate growth. The economic sentiment index dropped to 103 from a revised 103.9 in February.
Asia Pacific
Asian shares advanced after Federal Reserve Chair Janet Yellen offered a dovish outlook on the pace of rate increases citing heightened global risks. Stocks gained across Asia with the exception of Japan. Growth across Asia’s developing economies is expected to stall over the next two years amid a weak recovery in industrial nations and a slowdown in China according to the Asian Development Bank.
The Nikkei retreated 1.3 percent as the yen strengthened and weak industrial production data pointed to further softness in the economy. Japan’s industrial output dropped 6.2 percent in February from the previous month, the most since March 2011, as production of vehicles, electronic devices and manufacturing equipment dropped. Takata plummeted after Bloomberg News reported its recall costs could soar as high as ¥2.7 trillion in a worst case scenario. Automakers Toyota and Honda also declined as industry data showed automobile production in Japan was down for the third consecutive month in February. Ajinomoto slumped after lowering its earnings outlook.
Both the S&P/ASX and All Ordinaries edged up 0.1 percent in choppy trading. While banks ended narrowly mixed, miners BHP Billiton and Rio Tinto retreated. Newcrest Mining and Evolution Mining rallied after a weaker dollar helped gold prices snap a three-session losing streak. Energy shares were mixed.
The Shanghai Composite added 2.8 percent and the Hang Seng gained 2.1 percent as Ms Yellen’s cautious rate increase approach rekindled investors’ appetite for risk. The Kospi was up 0.4 percent to a 2016 high on foreign fund buying. The Sensex jumped 1.8 percent thanks to Janet Yellen’s remarks Tuesday. Tata Steel shares climbed after the company said it plans to sell its struggling UK business, including its Port Talbot plant in Wales.
Global Stock Markets

Please remember, the value of investments and the income from them can do down as well as up. Funds that invest in overseas markets may be subject to currency fluctuations. Investments in small and emerging markets can be more volatile than other overseas markets. Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities, but is included for the purposes of illustration only.
Looking forward*
Germany posts February retail sales and March unemployment. France reports consumer manufactured goods consumption. The UK releases its final estimate of fourth quarter gross domestic product. The Eurozone releases March flash harmonized index of consumer prices. In the US, the March Chicago PMI along with weekly jobless claims, money supply and Fed balance sheet will be reported.
*Note — all releases are listed in local time.

Source: Fidelity

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