Daily market review

United States

Equities gave back some of their recent gains Friday, with earnings still the focus, and as defensive sectors outperformed. The Dow Jones industrial average declined 0.5 percent, the S&P 500 fell 0.7 percent, and the NASDAQ slipped 0.9 percent.

Blowout earnings from Amazon after the close Thursday didn't inspire follow-through, with the stock ending down 0.1 percent. Investors appear to have priced lots of good news into the market. Mega-caps Apple, down 1.5 percent, and Alphabet, down 0.8 percent, paced a selloff in growth stocks despite huge earnings beats this week.

Energy led the way lower as the week's best performer retreated as oil prices ebbed. Technology stocks lagged, with chipmakers depressing tech after post-earnings weakness. Losses in internet stocks hurt communications services, with Twitter down 15 percent after downgrading its guidance.

Banks gave back some of the week's gains. Health care held up well, along with consumer staples, with a boost from drug stores. Strength in Tesla, up 4.8 percent on dip-buying, gave consumer discretionary a lift. Best sectors were defensives -- real estate, and utilities.

These price data reflect observations at 4:00 PM US ET: Dated Brent spot crude oil fell US$1.29 to US$67.25 while spot gold fell US$5.80 to US$1,768.15. The US dollar rose vs. most major currencies. The US Treasury 30-year bond yield was flat at 2.30 percent and the 10-year note yield was down 1 basis point at 1.63 percent.


Equities were mostly flat to weaker Friday after gloomy but as-expected Eurozone GDP figures. The Europe-wide STOXX 600 declined 0.3 percent, the German DAX eased 0.1 percent, the French CAC fell 0.5 percent, and the FTSE-100 was up 0.1 percent.

In line with expectations, the Eurozone economy slid into a double-dip recession in the first quarter. However, a 0.6 percent quarterly contraction was shallower than expected and with Covid hitting the year ago data harder, annual growth climbed from minus 4.9 percent to minus 1.8 percent. Still, GDP was still 5.5 percent below its pre-pandemic level.

UK markets outperformed, with a boost from better-than-expected quarterly results from AstraZeneca, up 4.3 percent, from paper packaging maker Smurfit Kappa, up 4.2 percent, and British American Tobacco, up 2.1 percent.

Among sectors, best performers included banks, travel & leisure, telecom, and real estate. Banco de Sabadell was among the day's leaders, up 5.8 percent, and Swiss Re rose 2.9 percent after reporting earnings beats.

Lagging were autos & parts, utilities, technology, chemicals, and basic resources. Svenska Cellulosa, the Swedish paper giant, fell 4.8 percent, and Ring Metall, the German metals manufacturer, fell 4.1 percent after reporting weaker than expected results.

Asia Pacific

Weaker Chinese data and regulatory concerns undercut Asian equities markets Friday, while disappointing guidance from tech stocks and chip shortages hurt Japanese markets.

Among Chinese markets, the Shanghai composite and the CSI 300 both slipped by 0.8 percent, and Hong Kong's Hang Seng index dropped 2.0 percent. A lower-than-expected Chinese official PMI manufacturing report hurt risk appetite, along with the latest episode in the Chinese regulatory crackdown on big internet/fintech players. Top Chinese regulators summoned Tencent (down 1.4 percent), JD.com (down 2.7 percent), and ByteDance, among other tech giants for more warnings about the firms' online finance businesses.

Growth stocks led Japan's markets lower with the Nikkei down 0.8 percent and the broader Topix off 0.6 percent. Sector performance was mixed, with marine transportation, iron & steel, and materials faring best. Weakest were transportation equipment, electric appliances, precision instruments, and banks. Among companies in the news, Apple suppliers Sony, down 7.7 percent, and Murata, down 3.6 percent, came off after Apple warned that chip shortages could hurt iPhone production.

Korean markets tracked Chinese markets lower, with the KOSPI down 0.8 percent, paced by a selloff in tech heavyweights, including SK Hynix, down 1.5 percent, and chemicals maker LG Chemical, down 2 percent.

Australian equities slipped Friday with the All Ordinaries index down 0.8 percent. Losses were nearly across the board, with commodities-linked stocks down the most. Beach Energy, the oil & gas producer, dropped 24 percent after announcing lower-than-expected oil reserves and downgrading its guidance. Miners lagged as industrial and precious metals prices declined. Industrials and utilities managed small gains.

India's markets gapped lower on profit-taking Friday after rising all week, and as pandemic worries brought markets back to earth. The Sensex fell 2 percent and the Nifty declined 1.8 percent, with banks leading the selloff.

In economic data, official Chinese PMI survey data suggest that growth slowed in both the manufacturing and the non-manufacturing sectors in April. The CFLP manufacturing PMI fell from 51.9 in March to 51.1 in April, below the consensus forecast of 51.7, while the non-manufacturing PMI, also published today, fell from 56.3 to 54.9. Separately, Japan's industrial production index rose 2.2 on the month in March, rebounding sharply from a fall of 1.3 percent recorded in February and much stronger than the consensus forecast for a drop of 2.0 percent.

Global Stock Market Recap

Global Bond Market Recap

Global Currency Recap

Commodities and currencies

Looking forward