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29 April 2019

29/04/2019

Morning Chat and Market Data

Morning Chat

What was: ‘twas a bleak week for European equities, worse for China, but not so bad for the US. The FTSE100 slipped 1.26%, CAC 0.40% and Italy’s MIB 0.73%; Germany’s DAX was a ray of light up 0.65%. Disappointing European economics with more stats slipping than surprising and weaker earnings hurt. The DAX was saved by news of Softbank’s €1billion interest in Wirecard. Over in the US, solid earnings were key, and the upbeat 3.2% Q1 GDP also helped push the S&P500 within inches of its all-time high (2939.88 versus 2,940.91). China’s slide looks like profit-taking after a strong rally.

What appears to be: Spain voted Sunday, or at least three-quarters of the electorate. Polling gave the governing Socialists 27.1%. They look to be on 28.7%. The previous governing Popular Party polled 18.4% but only won 16.7%. Moreover, right-wing splinter party Vox disappointed too polling 12.1% but winning only 10.3%. Meanwhile, Ciudadanos and Podemos with 15.8% and 14.3% of the election votes traded a point of polling between them. The Socialists are stronger but cannot rule alone, but if the results hold true, they might be able bypass the Catalonia independence parties and govern with Ciudadanos, a major political shift.

What might be: It could be a fruitful week from A to Z. We get results from S&P500 heavy-hitters Alphabet (Google) and Apple (Monday and Tuesday respectively) amongst others. Fan-favorite US non-farm payrolls on Friday (yep, it’s a new month). Estimates call for a fairly usual 180,000. Both our Bank of England and the US Fed hold their regular rate discussions, though probably no change there. We’ll get some European Q1 GDP data along with Hong Kong. Meanwhile, Japan is kicking back and staying closed until May 6 as they mark Emperor Akihito’s abdication Tuesday in favour of son Naruhito.

Market Data

Selected Global Aggregates (Total returns, unhedged)
MSCI AC World Equities (Local) up +3.88 (+0.31%) at 1,261 (YTD: 16.38%; 5YR: 57.2%)
MSCI AC World Equities (USD) up +36.26 (+0.40%) at 9,047 (YTD: 16.41%; 5YR: 46.5%)
Barclays Global Aggregate Bonds up +0.99 (+0.20%) at 487 (YTD: 1.75%; 5YR: 4.0%)

Selected Equity Indices (Capital returns)
S&P 500 up +13.71 (+0.47%) at 2,940 (YTD: 17.27%; 5YR: 56.5%)
NASDAQ up +27.72 (+0.34%) at 8,146 (YTD: 22.77%; 5YR: 98.5%)
Euro STOXX 50 up +8.49 (+0.24%) at 3,500 (YTD: 16.63%; 5YR: 9.1%)
FTSE 100 down -5.94 (-0.08%) at 7,428 (YTD: 10.40%; 5YR: 9.7%)
CAC 40 up +11.69 (+0.21%) at 5,569 (YTD: 17.73%; 5YR: 23.8%)
DAX up +32.58 (+0.27%) at 12,315 (YTD: 16.63%; 5YR: 28.5%)
Nikkei 225 down -48.85 (-0.22%) at 22,259 (YTD: 11.21%; 5YR: 55.8%)
Hang Seng up +245.74 (+0.83%) at 29,851 (YTD: 15.50%; 5YR: 32.9%)
MSCI Emerging Markets up +1.35 (+0.13%) at 1,078 (YTD: 11.63%; 5YR: 7.8%)

Selected Government Bond Yields
US 10 Year up +0.01 at 2.51 (began the year at 2.68; 5 years ago it was 2.69)
US 2 Year up +0.01 at 2.29 (began the year at 2.49; 5 years ago it was 0.44)
UK 10 Year down -0.01 at 1.14 (began the year at 1.28; 5 years ago it was 2.69)
Germany 10 Year up +0.01 at -0.01 (began the year at 0.24; 5 years ago it was 1.50)
France 10 Year up +0.01 at 0.36 (began the year at 0.70; 5 years ago it was 1.99)
Italy 10 Year down -0.04 at 2.54 (began the year at 2.74; 5 years ago it was 3.12)
Japan 10 Year down -0.01 at -0.05 (began the year at -0.01; 5 years ago it was 0.61)
Barclays EM Basket down -0.02 at 6.01 (began the year at 6.22; 5 years ago it was 5.70)

Selected Currencies
$ strengthened +0.0004 versus € (+0.04%) at 1.1159 ($: YTD: 2.56%; 5YR: 19.2%)
€ weakened -0.0007 versus £ (+0.06%) at 1.1592 (€: YTD: -3.99%; 5YR: 5.1%)
$ weakened -0.0003 versus £ (-0.02%) at 1.2936 ($: YTD: -1.49%; 5YR: 23.1%)
¥ weakened -0.0700 versus $ (-0.06%) at 111.6500 (¥: YTD: 1.78%; 5YR: -8.1%)

Selected Commodities
Brent Crude ($/bbl) down -0.05 (-0.07%) at 71.30 (YTD: 34.10%; 5YR: -34.8%)
WTI Crude ($/bbl) down -1.84 (-2.82%) at 63.30 (YTD: 39.40%; 5YR: -37.3%)
Gold ($/ozt) down -2.22 (-0.17%) at 1284.03 (YTD: 0.12%; 5YR: -0.9%)
Copper ($/mt) up +35.00 (+0.55%) at 6400.00 (YTD: 7.29%; 5YR: -5.4%)

Data sourced from Bloomberg as of the close of last trading day.
YTD = Year-to-date return; 5YR = five year return

Nicholas Lowson Senior Portfolio Manager Kleinwort Hambros