What mattered last week and a preview of the week ahead 30th March

What mattered last week:

  • A better week for global stock markets, and the S&P 500 enjoyed its strongest week since 2009, bouncing 10% from recent lows.
  • The rally gained traction following another round of aggressive easing measures from the Federal Reserve on Monday as well as the passing of a U.S $2tn stimulus bill.
  • However, the U.S. equity market still remains over 26% below its February high as the number of Covid-19 cases continuing to soar in the U.S. and Europe and social distancing laws remain in place.
  • Yields on the U.S. 10-year bond fell back to near 0.67%, supported by central bank bond-buying programs
  • Following two weeks of losses, gold rebounded strongly to close over 8.5% higher, near U.S $1625.
  • No respite for crude oil futures, falling another 5% last week to close near U.S $21.50/bbl.
  • Locally, the ASX200 ignored the strong gains in offshore equity markets to close the week mostly unchanged near 4850.
  • In FX, the AUDUSD benefited from a sharp pullback in the U.S. dollar across the board, gaining over 6% to close above .6150.

For the week ahead, the key events are:

Australia: Private sector credit (Tuesday), building approvals, CoreLogic March house prices, RBA meeting minutes (Wednesday), retail sales (Friday).

  • CoreLogic house prices (Wednesday): The impact of Covid-19 and social distancing is expected to show a slowing in house price growth to 0.7% in March.

New Zealand: Building approvals and ANZ business confidence (Tuesday).

China: NBS business condition PMI’s (Tuesday), Caixin manufacturing PMI (Wednesday), Caixin services PMI (Friday).

  • NBS business conditions PMI’s (Tuesday): Are expected to rebound from February’s depressed levels, while still remaining in contractionary territory.

Japan: Employment, retail sales, industrial production (Tuesday), Tankan business conditions survey (Wednesday).

U.S: Pending home sales (Monday), S&P Case Shiller home price index, CB consumer confidence (Tuesday), ISM manufacturing PMI (Wednesday), jobless claims (Thursday), employment (Friday).

  • Employment (Friday): The market is looking for a print of -175k and for the unemployment rate to rise from 3.5% to above 5%, due to the impact of Covid-19.

Canada: GDP (Tuesday), balance of trade (Thursday).

Euro Area: EA business confidence and economic sentiment index, German inflation (Monday), German employment and EA inflation (Tuesday), German retail sales and EA employment (Wednesday), EA retail sales (Friday).

UK: GFC consumer confidence and current account (Tuesday).

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