Weekly Market Calendar23/4 Japan PMI, NZ Credit Card Spending, France/German/EU Services/Manufacturing/Composite PMI, Chicago National Activity Index, US Services/Manufacturing/Composite PMI
24/4 Australia Consumer Confidence, Australia CPI, Japan Leading Index, US House Price Index, Case-Shiller Home Prices Index, US New Home Sales, Richmond Fed National Activity Index, US Consumer Confidence
25/4 US Weekly Mortgage Applications
26/4 German Consumer Confidence, ECB Rate Decision, US Weekly Jobless Claims, US Durable Goods Orders, Kansas City Fed Manufacturing Index
27/4 NZ Consumer Confidence, NZ Trade Exports/Imports, Japan Employment, Japan Industrial Production, Japan CPI, German Retail Sales, France GDP, German Employment, UK GDP, EU Consumer Confidence, US GDP, University of Michigan Sentiment
Weekly Market Commentary
US Equity markets closed the week lower, under threat from US Bond Yields, despite strong corporate earnings. US 10 Year Bond Yields are once again on the rise, with the Fed recognising the inflationary/growth pressures and signalling further rate rises. The rising interest rates present an attractive investment opportunity, while bolstering the Dollar, which has rallied strongly in to the weeks close. The EUR fell below 1.2300, while the GBP tests 1.4000, on the downside.
The rise in the reserve has bludgeoned commodity currencies, which have been rallying strongly of late. The rising US interest rates have only exaggerated the monetary cycle differences between Australia, New Zealand, Japan, EU and the USA. Inflation remains benign in these challenged economic zones, around 1%, reflecting weak economic growth and prospects. This has hit the previously high flying currencies hard, with the AUD falling to 0.7650, while the NZD tests the downside of 0.7200.
The new week will see further influence on equities and currencies, from economic data releases, unless there is a major Geo-Political event. Global Trade and North Korea appear to be the most likely risks. Global growth will come under the microscope, with GDP and CPI numbers released around the world. The US remains the stellar performer on the global stage and there is no reason to believe this narrative will change.
Paul Bettany
Collinson & Co
0406-744-923