Weekly Market Review –April 25–29 2016
Earnings season is upon us. Last week Microsoft and Google fell 5.41% and 7.17% respectively. On Tuesday after the markets close Apple and Twitter are scheduled to report their earnings, while Amazon is scheduled to report theirs on Thursday.
At the end of the last week’s trading session many of the major currencies dropped significantly. The Japanese yen fell against the USD by a whopping 2.57% while the Swiss franc fell by 1.19%. The New Zealand dollar and the euro fell by 0.81% and 0.43% respectively. The Australian dollar remained almost unchanged at -0.08%. On the other hand the Canadian dollar (+ 1.17%) and British pound (+ 1.54%) both rose.
Last week’s ECB meeting and the subsequent interest rated decision was by the far the most important event that occurred. Most attention was paid to the press conference given by ECB President, Mario Draghi. During his speech, Draghi mentioned that patience will be required in order to fully comprehend the ramifications of March’s rate slash. At the same time, he reiterated the possibility of further easing measures, which caused the euro to fall against most of the major currencies including the U.S. dollar. This week’s the main events will be the interest rate decisions given over by the Reserve Bank of New Zealand, U.S. Federal Reserve and the Bank of Japan.
Although the failed Doha summit caused the U.S. stock markets to plummet early last week, the markets recovered rather quickly and all losses were recouped. This occurred as new talks were scheduled to be held in the month of June. However, earnings season in U.S. additionally made its presence felt on the markets. Most companies missed the mark as they failed to meet expectations, with the biggest disappointments coming from Microsoft and Google. This week on Tuesday major companies Apple and Twitter are due to report their earnings which should greatly affect the market as a whole.
The European stock markets followed their American counterparts and additionally opened last week with a dud as the threat of cheap oil made its mark. However, much like the U.S. the gap was ultimately eliminated. European stock exchanges were further supported by the ECB’s decision to maintain the interest rate levels. This week, investors will closely monitor the Bank of Japan the U.S. Federal Reserve’s decisions regarding their interest rates.
During the first half of last week, gold prices displayed significant growth, which was caused by a general decline in the USD. However, during the second half of the week, the situation changed dramatically as investors decided to claim their profits. Additionally, Thursday’s better than expected U.S. labor market data helped spur the USD further, with the number of initial jobless claims dropping to its lowest level in the last 43 years. With regards to this week gold prices will depend heavily upon Wednesday’s upcoming FOMC meeting scheduled for 18:00 GMT.