Anchor resume from 13 to 20 of April 2018
Friday, 20 of April 2018
This week focus
European stock exchanges,
The optimism has returned to the financial markets favored by the results of the American companies, for the moment have been set aside concerns about the Syrian conflict and the latent trade war between the United States and China; This is shown by the retracement of the VIX volatility index to levels of 16 points at the end of the week. However, we look carefully at the moderation in a series of macroeconomic data that would anticipate a change in sentiment on the part of investors.
In the Eurozone the most relevant data of the week was inflation which stood at 1.3% year-on-year, below the preliminary estimates while the current account balance data also disappointed the market, in February the economy recorded a surplus of 35,100 million euros, with a decrease of 10% compared to the previous month, however in annual terms, it went from 3.4% to 3.7% of GDP.
For its part in the United Kingdom, we have the publication of unemployment data which stood at 4.2% while inflation moderated and levels of 2.5% for the month of March, which does not make it very clear if the BOE decides to raise Types in the next monetary policy meeting, holding back the recent appreciation of the currency at levels of 0.87 Euros per Pound.
In the United States, in addition to the exceptional quarterly results, the perspectives contained in the Beige Book of the FED, supported the bullish sentiment. The publication explains that the US economy continues to expand supported by increased consumption and an adjusted labor market; He also mentions that tax cuts have boosted companies' spending and investments, as well as the growth of trade and industry loans.
Given the economic strength reflected in the report of the Fed and the recent rebound in oil prices, inflation expectations increased and with it the expectations of increases in interest rates leading the US Treasury bond to 10 years to 2.91% levels.
Regarding the profits of American companies for the first quarter of the year, we highlight the Morgan Stanley performance with a profit growth of 38% over the same period of the previous year, while Goldman Sachs increased its profit by 26.6%, greatly exceeding the market expectations. On the other hand Netflix surprised with a BPA of 0.64 usd per share, which represents a growth of 62.8% in relation to the same period of 2017.
In this scenario, Wall Street ended the week with important advances. The Dow Jones closed around the 24,700 points adding 1.26%, the Nasdaq stood at levels of 6,770 points with an advance of 2.0% while the S & P 500 registered a rise of 1.4%.
European markets added to optimism with a weekly bullish close. The IBEX35 exceeded the barrier of 9,800 points and advanced 1.05%, the DAX ended around 12,567 points with a variation of 1.0% while the Eurostoxx50 added 1.13% to levels of 3,486 points.
In Asia, the easing of trade tensions allowed investors to focus on the macroeconomic evolution of the region and recover part of the lost ground. In China we have the publication of GDP which grew to 6.8% in the first quarter of 2018 exceeding the Government's objective, a figure that contrasts with the trade balance that registered a deficit of 4,042 million euros for the month of March. For its part, Japan registered a trade surplus of 793,300 million yen for the month of March, exceeding the market consensus, however the inflation figure surprised to the downside by 1.1% (Previous 1.5%) which would lead the BOJ to maintain its accommodative monetary policy.
Thus the Hang Seng recorded a slight decline of -0.32% to 30,708 points, while the Nikkei225 advanced 1.89% and the Sensex 0.69%.
In the commodities market, the Brent reference oil finished around 73.78usd / barrel with a significant weekly rebound in the face of the expectation of new agreements from producing countries; while gold remained flat at levels of 1,345 usd / oz.
For the next week, we will be attentive to the publication of the PMI and confidence indexes of the Euro Zone and the GDP of the United States; as well as the evolution of the conflict in Syria and the commercial approaches between the United States and China.