UK Stock-Market
- The UK stock-market was higher last week. Inflation remains the focus for investors.
- Data showed that UK GDP remains below pre-pandemic levels but expanded by 2.3% in April alone, and 1.5% in the three months to April as lockdown restrictions were eased.
- On Tuesday, the World bank lifted its global growth forecast to 5.6% for 2021, from a previous forecast in January of 4%.
- In Europe, the ECB said the pace of its Pandemic Emergency Purchase Programme would be “significantly higher” over the next quarter with Christine Lagarde warning against a “premature” reduction in support.
- Our Breadth indicator stayed positive and our Momentum Indicator ticked higher.
US Stock-Market
- The US stock-market was higher last week. The main focus was on May’s CPI (Consumer Price Index) data released on Thursday. Stocks were trading cautiously going into the data release especially after comments from Janet Yellen, US Treasury Secretary, that higher interest rates could be a ‘plus’.
- As it turned out CPI rose 5% in May, more than anticipated, but the detail in the data seemed to support the Fed’s view that the spike in inflation will be transitory. Stocks rallied following the data, helped as well by falling Treasury Yields.
- A poll of economists by Reuters indicated the majority expect the Fed to start cutting back its bond buying program early next year.
- This coming week, the June meeting of the FOMC will take place on Tuesday and Wednesday with policy expected to remain unchanged but investors will be looking for hints that the central bank may be shifting its view on inflation.
- Our Breadth Indicator stayed positive but our Momentum Indicator ticked back down.
The Big Picture 11th June 2021
Market Sentiment 11th June 2021
U.S. Risk Barometer 11th June 2021
Europe Risk Barometer 11th June 2021
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This communication is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell investments.’
