Macroeconomic/ geopolitical developments
- The season’s busiest week of quarterly earnings reports from the US, saw positives from Microsoft, Apple, Amazon and Meta lift the major US indices.
- After four weeks without any notable contagion, fears resurfaced last week as First Republic Bank related news weighed on the banking industry and reintroduced concerns about the health of regional banks.
- The Japanese Yen (JPY) was sent spiralling lower on Friday as the Bank of Japan (BoJ) seemed to outdo itself on the dovish scale.
Global financial market developments
- The major US stock averages dipped and rebounded last week, reinforcing the underlying positive theme from the March rally.
- European indices probed higher, building on the March recovery.
- US and European Bonds pushed to lower yield territory.
- The US Dollar Index was sideways again but remains vulnerable after hitting a multi-month low in mid-April.
- Gold marked time after the April sell off from a new 2023 and multi-month high in mid-month, still rejecting an immediate challenge to record levels.
- Oil prices sold off further from a multi-month high in mid-April, closing the bull gap from the early April surge (after the OPEC+ supply cuts were announced).
Key this week
- Holidays: A shortened week in China, the UK and Europe with markets closed Monday 1st for the May Day holidays.
- Central Bank Watch: Tuesday we get the Reserve Bank of Australia (RBA), who are expected to keep rates on hold at 3.60%, Wednesday brings the US Federal Reserve, expected to hike by 25bps to a Fed Funds range of 5.00%5.25% and Thursday we get the European Central Bank (ECB), who are expected to hike the deposit rate by 25bps to 3.25%.
- Macroeconomic data: US data focus is on the ISM Manufacturing Monday and Services on Wednesday with global S&P Global PMI data Monday-Friday.
- Earnings Season: US earnings season continues to unfold with Apple the standouts on Thursday.
| Date | Key Macroeconomic Events |
| 01/05/2023 | China, UK and Europe markets closed for the May Day holidays; ISM Manufacturing |
| 02/05/2023 | RBA monetary policy, Eurozone final Manufacturing PMI, UK final Manufacturing PMI, Eurozone HICP inflation, US JOLTS, US Factory Orders |
| 03/05/2023 | ADP Employment Change, ISM Services PMI, FOMC monetary policy |
| 04/05/2023 | China Caixin Manufacturing PMI, Eurozone final Composite PMI, UK final Composite PMI, ECB monetary policy |
| 05/05/2023 | China Caixin Composite PMI, US Non-farm Payrolls |
