Investors were cautious ahead of earning season despite reassuring comments from Fed Chair Janet YellenInvestors were cautious ahead of earning season despite reassuring comments from Fed Chair Janet Yellen.
United States
Stocks edged up in lackluster trading after backing off their early highs. Trading was choppy as traders kept an unusually close eye on developments in the currency markets. The Dow Jones industrial gained 0.2 percent and the S&P was up 0.3 percent. The Nasdaq was virtually unchanged (up 5.69 points). For the week the Dow and S&P were down 1.2 percent while the Nasdaq lost 1.3 percent. Volume was light.
The early strength reflected renewed risk appetite after investors set aside global economic concerns. A decline in the safe haven Japanese yen added to early buying interest although the yen subsequently rebounded and contributed to the pullback by the markets. Meanwhile, a substantial rebound by the price of crude oil helped to provide some support for the markets on the day. The rebound in crude oil came after Russian Energy Minister Alexander Novak said he hopes oil producing nations will agree to an output freeze at a meeting later this month.
In the latest comments from Federal Reserve officials, Fed Chair Janet Yellen said late on Thursday the U.S. economy was on “a solid course,” while New York Fed President William Dudley said on Friday a cautious and gradual approach to raising rates was appropriate.
Valeant Pharmaceuticals retreated after Bill Ackman said that the company would not sell Bausch and Lomb. Gap sank after the company’s disappointing same store sales for March prompted a broker downgrade.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down US$2.60 to US$1,239.50. Copper futures were up 0.5 percent to US$2.09. WTI spot crude was up US$2.46 to US$39.72. Dated Brent spot crude was up US$2.51 to US$41.94. The US dollar was down against all of its major counterparts including the euro, yen, pound, Swiss franc and the Canadian and Australian dollars. The Dollar Index was down 0.3 percent. The yield on US Treasury 30 year bond was up 4 basis points to 2.55 percent while the yield on the 10 year note was up 3 basis points to 1.72 percent
Stocks edged up in lackluster trading after backing off their early highs. Trading was choppy as traders kept an unusually close eye on developments in the currency markets. The Dow Jones industrial gained 0.2 percent and the S&P was up 0.3 percent. The Nasdaq was virtually unchanged (up 5.69 points). For the week the Dow and S&P were down 1.2 percent while the Nasdaq lost 1.3 percent. Volume was light.
The early strength reflected renewed risk appetite after investors set aside global economic concerns. A decline in the safe haven Japanese yen added to early buying interest although the yen subsequently rebounded and contributed to the pullback by the markets. Meanwhile, a substantial rebound by the price of crude oil helped to provide some support for the markets on the day. The rebound in crude oil came after Russian Energy Minister Alexander Novak said he hopes oil producing nations will agree to an output freeze at a meeting later this month.
In the latest comments from Federal Reserve officials, Fed Chair Janet Yellen said late on Thursday the U.S. economy was on “a solid course,” while New York Fed President William Dudley said on Friday a cautious and gradual approach to raising rates was appropriate.
Valeant Pharmaceuticals retreated after Bill Ackman said that the company would not sell Bausch and Lomb. Gap sank after the company’s disappointing same store sales for March prompted a broker downgrade.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down US$2.60 to US$1,239.50. Copper futures were up 0.5 percent to US$2.09. WTI spot crude was up US$2.46 to US$39.72. Dated Brent spot crude was up US$2.51 to US$41.94. The US dollar was down against all of its major counterparts including the euro, yen, pound, Swiss franc and the Canadian and Australian dollars. The Dollar Index was down 0.3 percent. The yield on US Treasury 30 year bond was up 4 basis points to 2.55 percent while the yield on the 10 year note was up 3 basis points to 1.72 percent.

Europe
Stocks rallied Friday after Thursday’s losses. Risk appetite among investors increased after comments made late on Thursday by Fed Chair Janet Yellen. Crude oil and metal prices recovered and stronger than expected German export data also contributed to the positive mood. The FTSE was up 1.1 percent, the CAC gained 1.3 percent, the DAX advanced 1.0 percent and the SMI was 0.7 percent higher. On the week, the FTSE was up 0.9 percent and the SMI added 1.7 percent. The CAC and DAX retreated 0.4 percent and 1.8 percent respectively.
Bank stocks staged a strong recovery at the end of the trading week. Italian banks were particularly strong on reports that an Italian plan to help troubled banks could be ready as soon as Monday. Remarks made by Federal Reserve Chair Janet Yellen during a panel discussion with former Fed chairs Ben Bernanke, Alan Greenspan and Paul Volcker Thursday provided a boost to investor sentiment. Yellen described the “tremendous progress” that the U.S. economy has made since the financial crisis and shrugged off concerns about an economic bubble. The current Fed Chair noted that the central bank would still watch the economy very carefully as it makes future decisions about interest rates.
The Bank of France raised its growth estimate for the first quarter thanks to improved export demand for manufactured products and increased services activity that led to employment growth. Gross domestic product likely increased 0.4 percent in the first quarter, which was slightly stronger than the 0.3 percent expected earlier.
Axel Springer jumped on a broker upgrade. RWE and E.ON advanced. Banks including Commerzbank, Deutsche Bank, Credit Agricole and BNP Paribas were up. In Paris, Société Générale climbed after European Union antitrust regulators cut the rate rigging fine imposed on the lender in December 2013. ThyssenKrupp and Salzgitter gained. Air France-KLM advanced after it reported a 3.2 percent improvement in passenger traffic, with a 1.3 percent increase in capacity for March 2016. Total and Technip were higher on the day. In London, Tullow Oil was up after confirming damage to production facilities at its Jubilee field in Ghana. Royal Dutch Shell and BP also were higher. Mining stocks including Anglo American, BHP Billiton, Glencore and Rio Tinto gained as metal prices recovered
Stocks rallied Friday after Thursday’s losses. Risk appetite among investors increased after comments made late on Thursday by Fed Chair Janet Yellen. Crude oil and metal prices recovered and stronger than expected German export data also contributed to the positive mood. The FTSE was up 1.1 percent, the CAC gained 1.3 percent, the DAX advanced 1.0 percent and the SMI was 0.7 percent higher. On the week, the FTSE was up 0.9 percent and the SMI added 1.7 percent. The CAC and DAX retreated 0.4 percent and 1.8 percent respectively.
Bank stocks staged a strong recovery at the end of the trading week. Italian banks were particularly strong on reports that an Italian plan to help troubled banks could be ready as soon as Monday. Remarks made by Federal Reserve Chair Janet Yellen during a panel discussion with former Fed chairs Ben Bernanke, Alan Greenspan and Paul Volcker Thursday provided a boost to investor sentiment. Yellen described the “tremendous progress” that the U.S. economy has made since the financial crisis and shrugged off concerns about an economic bubble. The current Fed Chair noted that the central bank would still watch the economy very carefully as it makes future decisions about interest rates.
The Bank of France raised its growth estimate for the first quarter thanks to improved export demand for manufactured products and increased services activity that led to employment growth. Gross domestic product likely increased 0.4 percent in the first quarter, which was slightly stronger than the 0.3 percent expected earlier.
Axel Springer jumped on a broker upgrade. RWE and E.ON advanced. Banks including Commerzbank, Deutsche Bank, Credit Agricole and BNP Paribas were up. In Paris, Société Générale climbed after European Union antitrust regulators cut the rate rigging fine imposed on the lender in December 2013. ThyssenKrupp and Salzgitter gained. Air France-KLM advanced after it reported a 3.2 percent improvement in passenger traffic, with a 1.3 percent increase in capacity for March 2016. Total and Technip were higher on the day. In London, Tullow Oil was up after confirming damage to production facilities at its Jubilee field in Ghana. Royal Dutch Shell and BP also were higher. Mining stocks including Anglo American, BHP Billiton, Glencore and Rio Tinto gained as metal prices recovered.

Asia Pacific
Shares were mostly lower Friday after oil prices fell overnight and shares in leading European and U.S. banks fell sharply on earnings worries.
The Nikkei advanced 0.5 percent (down 2.1 percent for the week) as the yen weakened slightly against the dollar in the wake of comments from Japan’s Finance Minister and Fed Chair Janet Yellen. While Japanese Finance Minister Taro Aso warned against rapid yen rise and vowed to take action if necessary, Yellen touted the strength of the US economy while speaking in New York alongside three of her predecessors — Ben Bernanke, Paul Volcker, and Alan Greenspan.
The Shanghai Composite retreated 0.8 percent as investors awaited a slew of March economic indicators including exports, growth and inflation due over the next week. The Hang Seng was up 0.5 percent. For the week, the Shanghai Composite lost 0.8 percent and the Hang Seng retreated 0.6 percent. China’s foreign exchange reserves grew in March for the first time in five months, indicating that the country’s central bank had eased its intervention in the currency markets.
Both the S&P/ASX and All Ordinaries were 0.5 percent lower, dragged down by banks. On the week, the former was down 1.2 percent and the latter lost 1.1 percent. Miners were mixed with BHP Billiton declining while Rio Tinto and Fortescue Metals Group advanced.
The Kospi slipped 0.1 percent (also down 0.1 percent on the week) amid institutional selling. Foreign investors turned net buyers in late trade, helping limit the downside. The Sensex was virtually unchanged on the day (down 11.58 points) and lost 2.4 percent on the week
Shares were mostly lower Friday after oil prices fell overnight and shares in leading European and U.S. banks fell sharply on earnings worries.
The Nikkei advanced 0.5 percent (down 2.1 percent for the week) as the yen weakened slightly against the dollar in the wake of comments from Japan’s Finance Minister and Fed Chair Janet Yellen. While Japanese Finance Minister Taro Aso warned against rapid yen rise and vowed to take action if necessary, Yellen touted the strength of the US economy while speaking in New York alongside three of her predecessors — Ben Bernanke, Paul Volcker, and Alan Greenspan.
The Shanghai Composite retreated 0.8 percent as investors awaited a slew of March economic indicators including exports, growth and inflation due over the next week. The Hang Seng was up 0.5 percent. For the week, the Shanghai Composite lost 0.8 percent and the Hang Seng retreated 0.6 percent. China’s foreign exchange reserves grew in March for the first time in five months, indicating that the country’s central bank had eased its intervention in the currency markets.
Both the S&P/ASX and All Ordinaries were 0.5 percent lower, dragged down by banks. On the week, the former was down 1.2 percent and the latter lost 1.1 percent. Miners were mixed with BHP Billiton declining while Rio Tinto and Fortescue Metals Group advanced.
The Kospi slipped 0.1 percent (also down 0.1 percent on the week) amid institutional selling. Foreign investors turned net buyers in late trade, helping limit the downside. The Sensex was virtually unchanged on the day (down 11.58 points) and lost 2.4 percent on the week.

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*
Central Bank activities

April 13

Canada

Bank of Canada Monetary Policy Announcement

United States

Federal Reserve Beige Book Published

April 14

UK

Bank of England Monetary Policy Announcement

The following indicators will be released this week…

Europe

April 12

UK

Consumer Price Index (March)

Producer Price Index (March)

April 13

Eurozone

Industrial Production (February)

April 14

Eurozone

Harmonized Index of Consumer Prices (March final)

April 15

Eurozone

Merchandise Trade (February)

Asia/Pacific

April 11

Japan

Private Machine Orders (February)

China

Consumer Price Index (March)

Producer Price Index (March)

April 13

Japan

Producer Price Index (March)

China

Merchandise Trade (March)

April 14

Australia

Labour Force Survey (March)

April 15

China

Gross Domestic Product (Q1.2016)

Industrial Production (March)

Retail Sales (March)

Americas

April 12

United States

Import/Export Prices (March)

April 13

United States

Retail Sales (March)

Producer Price Index (March)

April 14

United States

Initial Unemployment Claims (week ending prior Saturday)

Consumer Price Index (March)

April 15

Canada

Manufacturing Sales (February)

United States

Industrial Production (March)

Consumer Sentiment (April preliminary)

*Note — all releases are listed in local time.

Source: Fidelity

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