Market Report 17th April 2020

Market Report 17th April 2020 981 980 Realm
U.S. stocks showed a lack of direction on Thursday but futures are notably higher this morning.
  • European stocks closed mostly higher with investors reacting to reports that some countries in the continent have begun plans to ease lockdown restrictions following a drop in new coronavirus infections.
  • US stocks showed a lack of direction over the course of the trading session but managed to end the day mostly higher. The Nasdaq posted a particularly strong gain on the day, reflecting strength among tech stocks.
  • Asian stocks moved mostly lower in cautious trading as investors grappled with the financial fallout from the coronavirus pandemic. 

Global Macro

  • Housing starts in the US plunged 22.3% month-over-month to an annualized rate of 1.216 million in March of 2020 and below market expectations of 1.3 million. Despite the sharp drop, it is the lowest rate since July of 2019 only as the impact of the coronavirus may be visible in the April report only. Starts for the volatile multi-family segment slumped 32.1% to 0.347 million while single-family housing which is the largest share of the housing market, went down 17.5% to 0.856 million. Declines in housing starts were seen in all regions: the South (-21.3% to 0.693 million), the West (-18.2% to 0.301 million), the Midwest (-21.5% to 0.153 million) and the Northeast (-42.5% to 0.069 million). Year-on-year, housing starts rose 1.4%.
  • The number of Americans filling for unemployment benefits was 5.245 million in the week ended April 11th, down from the previous week’s 6.615 million and compared to market expectations of 5.105 million. The latest figure brought the total reported over the past month to 22 million, as the coronavirus pandemic swept across the US. The 4-week moving average, which removes week-to-week volatility, jumped to an all-time high of 5.509 million, while continuing jobless claims hit a record 11.976 million in the week ended April 4th.
  • The Eurozone industrial production fell 1.9% from a year earlier in February 2020, following a revised 1.7% drop in the previous month and compared to market expectations of a 2% contraction. Capital goods output shrank 3.6% (vs -1.7% in January) and energy production slumped 2.2% (vs -6.9% in January). Also, intermediate goods output continued to fall (-0.8% vs -1.5%).

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