Weekly Market View through 28th May 2021

Weekly Market View through 28th May 2021

UK Stock-Market

  • The UK stock-market was slightly higher last week. Large-cap stocks relatively struggled with the strength in the Pound which rallied on comments from a BoE member indicating the bank could raise interest rates early next year.
  • Helping sentiment was the continued expectation of low interest rates and the possibility of a huge new US spending plan from Joe Biden.
  • Data from the UK Office for National Statistics (ONS) showed that the level of government borrowing fell in April as lockdown restrictions eased, but still remains elevated with borrowing at £31.7 billion last month.
  • Boris Johnson cast doubt on the planned further easing of restrictions on June 21st due to the increasing spread of the Indian variant of coronavirus, saying “we may need to wait.”
  • Our Breadth indicator stayed positive but our Momentum Indicator ticked lower.

UK Market 28th May 2021
US Stock-Market

  • The US stock-market was higher last week. Monday saw gains in global markets led by technology stocks following the previous Friday’s positive PMI data.
  • Towards the end of the week, the PCE report, the Fed’s preferred measure of inflation, showed the month-over month reading in April rose to 0.6%, approximately in line with economists’ forecasts.
  • Investors remain focused on inflation prospects and central bank’s likely response but Fed officials attempted to allay investor’s ongoing concerns. James Bullard, St. Louis Fed President said, regarding changing monetary policy, “I don’t think we should do it when we’re still in the pandemic”. Investors will continue monitoring for any change in the Fed’s view that inflation pressures are “most likely to be transitory”.
  • Data showed that jobless claims in the US fell to a new pandemic low indicating healthy progress in economic recovery.
  • Also in focus is President Biden’s plans to for a huge $6 trillion budget which will include a massive spend on infrastructure projects and US Personal Consumption Expenditure data.
  • Our Breadth indicator stayed positive but our Momentum Indicator ticked lower.

US Market 28th May 2021
The Big Picture 28th May 2021
Market Sentiment 28th May 2021
U.S. Risk Barometer 28th May 2021
Europe Risk Barometer 28th May 2021
Disclaimer: ‘Where the business has expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. The information contained within this communication is believed to be reliable but Realm Investment Management Limited does not warrant its completeness or accuracy.
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.

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