It’s Monday once again and many will be hoping the surge in US indices seen late on Friday will carry some momentum over into this week. The moves came as a surprise after a frankly lacklustre week all round, traders perhaps latching onto what little semblance of stability they could. The Nasdaq Composite led the charge with a whopping 2.05% increase on the day, completely erasing its mid-week slump to close at 13,798. The S&P 500 wasn’t too far behind with a 1.56% gain and the Dow Jones managed to finish 1.15% in the black.
Whatever the reason for optimism in US markets, it did not extend to the other side of the Atlantic, nor to the Pacific for that matter. The FTSE 100 dropped 1.28% on Friday, the French CAC 40 lost 0.96% and the DAX finished 0.77% in the red. In Hong Kong, the Hang Seng index ended a dismal week with a fitting 1.76% close in the red. The Nikkei 225 escaped relatively unscathed, only losing 0.24%.
Gold continued to lose out after making no attempt to reclaim the $2000 level last week, finishing Friday with another 1% drop, now languishing around $1935. The price action recently seen in oil suggests the geopolitical concerns in the Middle East have been all but forgotten, with West Texas Intermediate now sitting around the $76 mark.
The Dollar Currency Index didn’t have much to say for itself last week, all eyes on USDJPY once again. Its attempt to push back below 150 ended in failure last Monday, things only getting worse as the week progressed, closing Friday at 151.5 Yen.
The Bureau of Labor Statistics spoils us with inflation, CPI and PPI this week. All important clues as to whether the Federal Reserve will soon have the reasons it needs to pivot towards lower interest rates. The brief euphoria seen on Friday will be brief indeed if it becomes apparent that the Fed does in fact not have the motivation it is looking for to ease the money supply.
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