Anchor resume from 28 of April to 5 of May 2017
Monday, 08 of May 2017
Positive closures on European stock exchanges and cutbacks in government bond yields anticipating the victory of the pro-Europeanist party in France led by Emmanuel Macron. As the polls pointed out, the French Socialist party won the second round of the election with the 65% of the votes.
The week was particularly positive in the Eurozone, Greece finally reached an agreement with its creditors after implementing further reductions of pensions and increases in the country's taxes. With this, the Greek country's debt is expected to remain sustainable and funds will be unlocked to complete the third bailout. Likewise, the published macroeconomic data supported the vision of positive growth in the region. The leading indicator of economic activity reached high expansive rates (56,7 current vs. 56,2 expected). With all this, we can say that some of the risks that we had in mind when analyzing the evolution of the markets had been reduced. This was reflected by the selectives after Friday’s closures. Once again, the Spanish selective IBEX-35 has been the biggest beneficiary after the advances reached of +3,92% up to levels of 11.135 (summing up a +19% YTD), the STOXX-50 for its part, rebounded up to 3.658 (+2,79%), While the DAX-30 surpassed historical high levels after ending last Friday at levels of 12.716 (+2,24%).
Throughout the week, in the US we were attentive to the statements made by Janet Yellen following the meeting of the Federal Open Market Committee. The benchmark interest rate remained unchanged as expected in the +0,75% and +1% range, leaving open the possibility of a further rate hike in June.
Equity markets on Wall Street, however, closed with somewhat more moderate gains. We have been witnessing the publication of important macroeconomic data of the labor market, which maintained its strength they have shown up to now. To note the recent increase in the creation of non-agricultural employment (211.000 new posts compared to the 185.000 estimated by the consensus of analysts), favoring expectations of a new rate increase at the next FED’s meeting.
As for the weekly closures, the NASDAQ-100 ended at levels of 5.646 (+1,12%), while the S&P-500 did so just below the 2.400 (area in which in case it gets over it we could go back to talk about "free climb").
Mixed closures in the Asian stock markets after the early releases of activity indicators. The selective Hang Seng fell down a -0,56% weakened by the fall in the last data of the manufacturing PMI (currently at 50,3 with respect to previous and predicted levels of 51,2). On the other hand, the NIKKEI-225, despite having paid a semi-festive week for the country, registered advances of above 1% (ending around 19.445).
Major commodities traded lower; The Brent Barrel with declines of -5% at levels lower than the 50 USD/Brent pending to reach new cutbacks agreements in production levels. The onz of gold suffered cuts as well, of -3% (now trading around the 1.227 USD/Onz.) due to the reduction of uncertainty after the resolution of the French elections.
As for currency, the Euro was the biggest beneficiary; the EUR/USD pair stood at 1,0995 (+0,92%), while the EUR/JPY pair traded at 123,92 after a close of +2%.