Aside from gains in the Dow, indices have struggled to make headway on the first day of the new working week.
Indices have generally failed to maintain the bullish atmosphere from Friday’s US jobs report, holding in the red aside from the Dow. Hopes that Friday’s report could prompt a renewed equity rally seem to have fizzled out for the time being, although dip buying has been seen in the Dax and other European indices. Meanwhile the Dow seems to be in a world of its own, crossing the 35,000 mark for the first time in its history thanks to a bounce in healthcare and retail names. But with earnings season winding down and strong seasonality now behind us for the time being it looks like indices will continue to struggle; historically May is a month of digestion for indices, representing a slowdown in forward momentum from the opening months of the year, and if Friday’s jobs report isn’t enough to move the market on into new territory then it is hard to see what will.
Sterling traders seem unperturbed by the prospect of the UK economy moving into another period of political uncertainty, as the elections put the SNP’s independence plan back on the agenda. An attritional battle through the courts to decide on the legality of a referendum seems likely, taking some of the shine off the prospects for the UK economy. Nonetheless, with the dollar now finding it harder to rally in the wake of the non-farms report it looks like sterling can still make headway for the time being.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
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.