- The UK stock-market was lower this week with markets focused on rising global inflation. Bank of England Governor Andrew Bailey said inflation is being watched carefully. This coming Wednesday, the US Fed will be releasing minutes from its most recent meeting which may give insights into the US central bank’s thinking on the matter.
- Data released by the ONS (Office for National Statistics) showed the UK economy contracted by 1.5% in the first quarter but this was not quite as bad as forecasts of 1.7% by economists. UK chancellor, Rishi Sunak, said he would “continue to take all the steps necessary to support our recovery”.
- The UK begins a new phase of lockdown easing today but the spread on the Indian variant is causing concern. Boris Johnson said the government is concerned and implied that nothing can be ruled out.
- Our Breadth indicator stayed positive and our Momentum Indicator, ticked higher again.
- The US stock-market was lower this week with the Technology sector under-performing again – this has become a theme recently.
- Increasing inflation fears and rising commodity prices spooked the markets early in the week. Data midweek showed that the Consumer Price Index spiked 4.2% from a year ago. US inflation is now accelerating at its fastest pace since 2008. Investors fear that increasing pressure will prompt the Fed to tighten policy at an earlier date than has been expected.
- Markets bounced back after US weekly initial jobless claims came in at a 14 month low. Fed comments reiterating the view that a rise in inflation would be temporary also helped market sentiment.
- Our Breadth indicator stayed positive and our Momentum Indicator ticked higher.
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