Anchor resume from 21 to 28 of April 2017
Tuesday, 02 of May 2017
The month of April has been ended with the main selectives in green after the publication of important macroeconomic data, among which we can highlight the recent rebound in the consumer price index.
Contrary to the expected, consumer prices rallied during the month of April up by a +1,9% up in contrast with the +1,8% estimated by the analysts. This, after the meeting of the ECB’s members meeting last Thursday, keeping the QE and monetary policy unchanged (rates and deposit rate without changes at +0% and -0,40% respectively), led to an increase in expectations that the ECB will make policy changes for the next meeting in July. In a result, government bond prices became downward pressured by higher inflation expectations and a further advance in monetary policy. On the contrary, the Euro recorded new advances; of +1,58% against the US dollar to the 1,0895 EUR/USD, while the yen rebounded a +3.86% up to to around 121,5 EUR/JPY.
As for the equity markets, the week started with significant advances thanks to the good outcome of the first round in the French presidential. In result, the weekly evolution became positive with rallies of +3,47% in the selective STOXX-50 after rising up to the 3.559, a +3,39% in the DAX-30 ending around the 12.438, while the IBEX- 35 made it up to the 10.715 after registering a +3,36%.
Within the United States, we are still immersed in the results publication season. So far the evolution is being positive with average EPSs of +11,8% compared to the +9,7% expected by the group of analysts.
The motor of the market for the region was the announcement of the main lines that the fiscal plan from Donald’s Trump administration will follow. The announced measures followed what was expected by the market. The corporate tax cut was confirmed at +15%, being the creation of jobs and growth the main priority. However, the good tone disappeared after the publication of the latest GDP data on Friday, reflecting a slowdown in growth rates of +0,7% compared to the +1,2% expected.
With this, the weekly balance became positive despite the fact that on Friday’s session the progress slowed down. Despite that slowdown, the technologic selective Nasdaq Composite went up by +2,32% quoting at 6.047, while the S&P500 made so around the 2.384 with advances of +1,51%.
We are still pending of the US conflict with North Korea, as changes in relations of both powers since it would have an immediate effect for the other regions.
In spite of the tensions and uncertainty generated in the markets, the last meeting of the BOJ, no significant changes in monetary policy were announced and the positive outlook for the economy was maintained. However, it should be noted the rebound in retail sales and price indexes of +0,2% and +0,8% respectively, surpassing market expectations in both cases.
The closures became positive as well. The NIKKEI-225 would be the most remarkable case since after scoring a +3%, rising up to the 19.196, what turned into to positive ground the YTD performance. The gains in the Hang Seng supposed an advance of +2,38% up to the 24,615 accumulating already a +11.88% YTD.
On the whole, we can see that the uncertainty remained low as reflected by the falls of -26% within the VIX and the price of the ounce of gold which went down by -1,27% up to the 1.267. While the price of crude remained at 51 USD/Brent pending new catalysts that make improvements within the expectations of the price of the commodity.