UK markets
The past week has seen profit warnings by the score, plus an increase in concerns surrounding China growth and Fed policy. Banks have risen on news that there may be a co-ordinated settlement of FX manipulation charges, but overall the market itself is still looking distinctly weak. Any close below 6650 for the FTSE will put the bears in charge for the week to come, especially in an environment where looming non-farm payrolls keep equity investors on the sidelines. With two trading days of the quarter left we could see fresh lows in the early part of next week, especially if China and US figures on Tuesday are below expectations. Sellers of supermarkets are still to be found, as Sainsbury’sand Morrisons have discovered today, while real estate trusts such as British Land and Hammerson are finding buyers thanks to their solid dividend appeal.
US markets
US indices have seen some booking of gains by shorters, which has allowed the Dow to recover the 17,000 level. Technical traders will still be watching the Russell 2000 after its ‘death cross’ this week, even if support is still likely to be found around current levels. The macro calendar next week is busy enough to bridge the gap until earnings season, but the lesson from the end of the third-quarter is that volatility is back on the agenda. The coming three months should see a much more cautious atmosphere, particularly if improving US data lends weight to the theory that an interest rate hike is coming much earlier than expected.Commodities
What began as a morning of small gains for gold turned into yet another day of selling, with gold pushing back towards $1200. This is the problem for commodities at present – they do poorly on days when stocks are up, and on days when the dollar is up. For the time being, until such time as another geopolitical event crops up, additional downside for commodity prices looks fairly certain, especially as long as the US dollar is in favour. This applies even to crude prices, where the short-term bounce in US light crude seems fated to come to an end as supply considerations take over.FX
Having tested $1.27 yesterday, EUR/USD is falling once again. This week has not been particularly busy on the macro economic front, although speeches from Draghi have done their bit to imply that the euro will be going lower in due course. In the week to come, German and eurozone unemployment and price data will act as a useful prelude to the ECB meeting, but if Draghi is to restore confidence he either needs to implement full blown QE or find a form of words that has proved to be more reassuring than his pronouncements so far.
Recommended Content
Editors’ Picks
EUR/USD steady below 1.0800 after US PCE meets expectations
EUR/USD remains depressed below 1.0800 after soft French inflation data, amid minimal volatility and thin liquidity on Good Friday. The pair barely reacted to US PCE inflation data, with the Greenback shedding some pips. Fed Chair Jerome Powell set to speak ahead of the weekly close.
GBP/USD hovers around 1.2620 in dull trading
GBP/USD trades sideways above 1.2600 amid a widespread holiday restraining action across financial markets. Investors took a long weekend ahead of critical United States employment data next week. Fed Chair Powell coming up next.
Gold price sits at all-time highs above $2,230
Gold price holds near a fresh all-time high at $2,236 in thinned trading amid the Easter Holiday. Most major world markets remain closed, although the United States published core PCE inflation, the Federal Reserve’s favorite inflation gauge.
Jito price could hit $6 as JTO coils up inside this bullish pattern
Jito (JTO) price has been on an uptrend since forming a local bottom in early January. Since then, JTO has revisited the key swing point formed in early December, suggesting the bulls’ intention to move higher.
Key events in developed markets next week
Next week, the main focus will be inflation and the labour market in the Eurozone. We expect services inflation to be impacted by the easter effect, while the unemployment rate to be unchanged.