Anchor resume from 4 to 11 of May 2018

Anchor resume from 4 to 11 of May 2018


The United States CPI  and the geopolitical tension of the Middle East focused the attention of the investors during the week who maintained prudent positions before the fears of a strong increase of prices in the United States; however, the CPI registered for April advanced by 0.2% with respect to the previous month, slightly below expectations, while the inter-annual variation was 2.5%.

These data reinforce the probability of an increase in interest rates by the FED at its meeting in June and the continuity of its policy of gradual increases, which gave tranquility to the markets, boosting equity assets slightly. However, tensions in the Middle East and the consequences of the departure of the United States from the agreement with Iran, have generated upward pressure on the price of oil which would impact inflation in the coming months.

After the publication of the inflation data, the dollar fell back against its peers, the EUR / USD ended the week around 1.1925, and the USD / JPY at 109.38, while the 10-year US Treasury bonds ended with yield of 2,971%

For its part, the pound sterling also lost value against the euro and the dollar, after the decision of the Bank of England to maintain its reference rate unchanged at levels of 0.5%, the monetary authority decided to postpone the increase as a result of the slowdown of the economy, originated by the uncertainty that the Brexit presupposes, and the decrease of inflation.

In the debt market, European risk premiums increased in a generalized manner, especially in Italy, which increased its premium by 13.3bps due to political uncertainty and the possibility of holding early elections, raising a new risk for the economic bloc; Spain and Portugal also recorded increases in their yields.

The eurozone's sentiment sentiment measured by the Sentix index fell to 19.2 from 19.6 in April, the drop is attributed to lower growth expectations, which have been suggested by the latest macroeconomic publications. In Germany, we have the industrial production data for March, which was above the estimates at 1% (Estimated 0.8%), while factory orders fell 0.9% unexpectedly.

In Asia we have mixed data, China's CPI slowed down in April with a rise of 1.8% year-on-year (after 2.1%) due to a moderation in food prices while the trade surplus was reduced by 24% as a result of a strong increase in imports so far this year. For its part, Japan achieved a current surplus of 23,986 million euros in March, in response to a 3.4% growth in exports while imports contracted compared to the same month of the previous year.

Thus, the market ended the week in an optimistic tone encouraged by the inflation data of the United States. The Ibex 35 exceeded 10,200 points adding + 1.41%, the DAX did so at 1.59% while the Eurostoxx50 had a weekly variation of 0.54%.

In the United States the gains extended to a greater extent, the Dow Jones advanced 1.97% while the S & P500 added 2.24%.

The Asian markets also closed with gains, the Nikkei 225 reached 22,497 points + 0.11% and the Hang Seng did it at 30,809 points advancing 2.95%.

In the commodities market, oil adds another positive week around 77.47 USD / barrel for the Brent reference with a weekly variation of 3.47%, while gold ended at levels of 1,321 USD / oz with a slight variation of 0.48% .

For the next week, the data of economic growth and the CPI of the Eurozone will focus the attention of the market, however news related to oil production and geopolitical tensions will mark the pace of assets during the following sessions.

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