Even though we saw some consolidation on Friday following a significant rally during the week, last week ended on a great note for the major US, European and Japanese stocks. Chinese and British stocks are left behind the global rally.

It’s important to keep in mind that while everybody was watching Nvidia with their stomachs in their mouth - and the broad-based stock rally that followed its earnings, the US yields were gently drifting higher. This week, investors’ attention will gently shift from earnings to economic data. The latest US GDP update – due Wednesday - is expected to confirm a 3.3% growth in Q4, with significantly lower price index. And on Thursday, the PCE data are expected to confirm relatively soft figures – softer than the CPI, most probably thanks to the different weights that the index attributes to different categories of goods and services. In all cases, a strong growth could revive the goldilocks optimism if inflation numbers continue to trend lower. For the market rally to continue, we just need strong growth and soft inflation data from the US. Easy, no?

 

This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.

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