Stocks were mostly lower Friday as the first quarter ended.
United States
US shares retreated Friday — investors were looking forward to first quarter corporate earnings reports to see if they will justify the market’s high valuations. On the week, the Dow Jones industrials were up 0.3 percent and gained 4.6 percent in the first quarter even though the index lost 0.7 percent in March. The S&P added 0.8 percent on the week and 5.5 percent in the first quarter. The index was unchanged in March. The Nasdaq outpaced both the Dow and S&P — it was 1.4 percent higher on the week, 1.5 percent for March and an impressive 9.8 percent for the quarter.
JPMorgan Chase and Wells Fargo were lower along with Exxon Mobil. FMC Corp rallied after it agreed to buy DuPont’s crop protection business and sell its health and nutrition unit to DuPont. DuPont was lower. Amazon.com rose to a record high. FreightCar America retreated. Apple rallied.
Personal income in February increased 0.4 percent after rising an upwardly revised 0.5 percent in January. However, personal spending disappointed. Spending inched up only 0.1 percent in February after rising 0.2 percent in January. March Chicago business barometer reading was 57.7 in March, up from 57.4 in February. The University of Michigan’s final March consumer sentiment index reading was 96.9, down from its preliminary March reading of 97.6. However, the index was still higher than the final February reading of 96.3.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down US$3.95 to US$1,244.85. Copper futures were down 0.7 percent to US$2.65. WTI spot crude was up 25 US cents to US$50.60. Dated Brent spot crude was up 40 US cents to US$53.53. The US dollar was up against the euro, Swiss franc and the Australian dollar. The currency declined against the yen, pound and Canadian dollar. The Dollar Index was down 0.2 percent. The yield on US Treasury 30 year bond was down 2 basis points to 3.01 percent while the yield on the 10 year note was down 3 basis points to 2.39 percent.
Europe
Stocks here were mixed Friday but mostly advanced for the week. Only the FTSE slipped 0.2 percent for the week. However, the indices were up in March and for the quarter. Investors were deluged by new economic data Friday. Inflation in the euro area eased more than expected in March, adding pressure on the European Central Bank to continue with its stimulus measures.
FTSE was up 0.8 percent in March and 2.5 percent in the first quarter of 2017. The CAC gained 5.4 percent both in March and for the quarter. The DAX added 4.0 percent and 7.2 percent while the SMI was 1.3 percent and 5.3 percent higher for the month and quarter.
On the Brexit front, European Council President Donald Tusk said Friday that discussions on the European Union’s future relationship with the UK can be held only after sufficient progress is made on the country’s exit. The EU stance is in contrast to the British Prime Minister Theresa May’s proposal that talks on the UK withdrawal and future relationship with the EU, covering areas such as trade and citizens’ rights, be held simultaneously.
Siemens rose after completing its acquisition of Mentor Graphics. Phoenix Solar jumped after the company reported a positive EBIT result for 2016 and said it expects strong revenue and earnings growth for 2017. Smiths Group retreated. The US Department of Justice wants the company to divest Morpho Detection and Morpho Detection International’s global explosive trace detection business in order to proceed with its proposed $710 million acquisition of Morpho from Safran. Miners Anglo American, BHP Billiton and Rio Tinto retreated as they tracked metals prices lower.
Eurozone inflation eased to 1.5 percent on the year in March from 2 percent in February. Germany’s retail sales declined at the fastest pace since late 2014 in February. Retail sales dropped 2.1 percent on the year, reversing most of January’s revised 2.7 percent increase. Germany’s ILO jobless rate was 3.9 percent in February, the same as in January. France’s consumer spending decreased in February after rebounding in the previous month. Consumer spending dropped 0.8 percent on the month in February, reversing a 0.6 percent increase in January. The final estimate of UK gross domestic product climbed an unrevised 0.7 percent on the quarter.
Asia Pacific
Stocks were mostly lower Friday. Investors were looking ahead to the highly anticipated meeting between US President Donald Trump and Chinese President Xi Jinping on April 6 and 7. The yen remained weak pressuring Japanese stock indices.
The Shanghai Composite was up 0.4 percent after the March official CFLP manufacturing PMI edged up to 51.8 from 51.6 in February. The Hang Seng however, was down 0.8 percent. The Shanghai Composite was down 1.4 percent on the week and 0.6 percent lower in March. However it gained 3.8 percent in the first quarter. The Hang Seng dropped 1.0 percent on the week but was up 1.6 percent and 9.6 percent on the month and quarter respectively.
The Nikkei and Topix lost 0.8 percent and 1.0 percent respectively on Friday as exporters lost ground despite a weaker yen and upbeat domestic data. Toshiba jumped on a Nikkei report that private equity firm Silver Lake Partners and US chipmaker Broadcom have offered the company about ¥2 trillion for its memory chip business. The Nikkei was down 1.1 percent for both the month and quarter while the Topix was down 1.5 percent and 0.4 percent respectively. February core consumer price index was up 0.2 percent on the year. Industrial production jumped 2.0 percent on the month but household spending tumbled 3.8 percent on the year.
Both the S&P/ASX and All Ordinaries lost 0.5 percent Friday after banks and energy stocks succumbed to heavy selling. The big four banks were lower as the Australian Competition and Consumer Commission (ACCC) denied authorization for banks to collectively bargain with Apple to allow iPhone users to make mobile payments from their own digital wallets, rather than use Apple Pay. Energy majors Woodside Petroleum, Santos, Oil Search, Beach Energy and Origin Energy also declined. Both indices were up 1.9 percent on the week. In March, the S&P/ASX added 2.8 percent and was up 3.5 percent for the first quarter. The All Ordinaries added 2.5 percent and 3.2 percent respectively.
The Kospi slipped 0.2 percent Friday and was down 0.4 percent on the week. However, it gained 3.3 percent and 6.6 percent in March and the first quarter respectively. The Sensex retreated 0.1 percent on Friday but added 0.7 percent on the week. For the month and first quarter, the index added 3.1 percent and 11.2 percent respectively.
Looking Forward

Central Bank activities

April 4

Australia

Reserve Bank of Australia Monetary Policy Announcement

April 5

United States

FOMC Minutes Published

April 6

India

Reserve Bank of India Monetary Policy Announcement

The following indicators will be released this week…

Europe

April 3

Eurozone

Manufacturing PMI (March)

Producer Price Index (February)

Unemployment Rate (February)

Germany

Manufacturing PMI (March)

France

Manufacturing PMI (March)

UK

Manufacturing PMI (March)

April 4

Eurozone

Retail Sales (February)

April 5

Eurozone

Composite & Services PMI (March)

Germany

Composite & Services PMI (March)

France

Composite & Services PMI (March)

UK

Services PMI (March)

April 6

Germany

Manufacturing Orders (February)

April 7

Germany

Industrial Production (February)

Merchandise Trade (February)

France

Industrial Production (February)

Merchandise Trade (February)

UK

Industrial Production (February)

Merchandise Trade (February)

Asia Pacific

April 3

Japan

Tankan Survey (Q1.2017)

Manufacturing PMI (March)

China

Manufacturing PMI (March)

April 4

Australia

Merchandise Trade Balance (February)

Americas

April 3

United States

Manufacturing PMI (March)

ISM Manufacturing Survey (March)

Construction Spending (February)

April 4

Canada

Merchandise Trade Balance (February)

United States

International Trade (February)

Factory Orders (February)

April 5

United States

ADP Private Employment (March)

Services PMI (March)

ISM Nonmanufacturing Survey (March)

April 7

United States

Initial Unemployment Claims (week ending prior Saturday)

April 7

Canada

Labour Force Survey (March)

United States

Employment Situation (March)

Global Stock Markets

*Note — all releases are listed in local time.

Source: Fidelity

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