Dax 30; Ftse 100; SP 500 - Market View

[alanfox12]

that information of the FED have effect only a time

 

[psaTrading]

Dollar rises overnight, 10-year yield holds close to 2.97%

 

[psaTrading]

Stocks nosedived today (Tuesday), with the Dow Jones industrial average sinking 600 points at session lows.

 

[psaTrading]

As expected, the ECB kept interest rates unchanged as well as the stimulus policy to the economy covering the monthly purchase program of 30,000 M.€ in assets up to September. At the press conference after the meeting, Mario Draghi confirmed that the European economy is undergoing a more moderate growth period, although it remains consistent with a solid expansion phase. Regarding inflation, Draghi mentioned that the ECB’s board of governors remains confident that inflation will converge towards the monetary authority’s target (inflation next but below 2%).

 

[psaTrading]

European markets were up on the last day of the week. As in the US, the highlight is for the technology sector.

 

[psaTrading]

In terms of economic indicators, consumption-related inflation, the measure most considered by the Fed, stood at 1.90% in March, compared to the same month last year, which puts it at highest level of the last 17 months. In the same month, household income increased 0.30% (vs. 0.40% estimated) and expenses grew 0.40% (vs.

 

[psaTrading]

The dollar had its biggest advance in more than a week.

 

[psaTrading]

Federal Reserve relaxed toward inflation rising above 2 percent signaling no intention to accelerate a gradual tightening of monetary policy.
FED should raise benchmark rates in June.

 

[psaTrading]

In terms of economic indicators, the number of weekly applications for unemployment benefits stood at 211,000, compared to 225 000 and then 209 000 in the previous week. The ISM index for the services sector stood at 56.80 compared to the projected 58.00 and the trade deficit reached 49 000 M.USD, below the expected 50 000 M.USD. Factory orders increased 1.60% in March (vs. 1.40% estimated), while orders for durable goods grew 2.60% in the same month.

 

[psaTrading]

Wall Street was trading higher as investors reacted to the employment report, highlighting Apple's shares favoring stock indexes. The government reported that during April, the US economy created 164,000 jobs, down from 192,000 expected by economists. On the other hand, the increase in average hourly wages also fell short of expectations (0.15% vs. 0.20%). We must remember the importance of this last indicator, since in many economic cycles are the precursors of inflation. The US unemployment rate fell from 4.10% to 3.90% in April, down from 4%. In the business field, Apple rose 3.42%, after investor Warren Buffett revealed that during the first quarter acquired 75 million shares.