Daily market review

United States

Equities recovered to end in positive territory with support from energy and materials stocks and late bargain hunting at the start of the quarter. The Dow Jones industrial average rose 0.4 percent, and the S&P 500 and the NASDAQ both firmed 0.3 percent.

Most sectors managed gains, led by energy, despite seesawing oil prices amid uncertainty over the supply situation and the impact of announcements the US and its allies would tap strategic oil reserves. Chinese tech stocks bounced back on reports suggesting the US and China would compromise on audit rules for US-listed stocks threatened with delisting in the US for failing to meet US disclosure requirements.

Recession talk continued as the US Treasury 2-year to 10-year yield curve inverted after US employment figures bolstered expectations the Federal Reserve would start an aggressive tightening cycle with a 50 basis point rate hike in May.

Lagging were transports, machinery, pharma, technology, banks, drug stores, and apparel. On the positive side were energy, homebuilders, selected tech, insurance, auto parts, precious metals, and alternative energy stocks.

Among companies in focus, JB Hunt, the trucking giant, fell 9.6 percent, and Norfolk Southern, the railroad, lost 2.1 percent as sentiment turned negative on the sector. PNC, the bank, fell 1.8 percent after disappointing guidance. Among Dow stocks, Intel dropped 2.9 percent, Walgreens lost 2.0 percent after reporting weakening demand as the pandemic fades, and Caterpillar fell 1.4 percent.

These price data reflect observations at 4:00 PM US ET: Dated Brent spot crude oil fell US$3.33 to US$104.58 while spot gold fell US$14.34 to US$1,923.58. The US dollar rose vs. most major currencies. The US Treasury 30-year bond yield fell 3 basis points to 2.42 percent, and the 10-year note yield rose 4 basis points to 2.37 percent.


Equities improved in a mixed sector showing with company news providing support. The Europe-wide STOXX 600 rose 0.6 percent, the German DAX rose 0.2 percent, the French CAC gained 0.4 percent, and the UK FTSE 100 was up 0.3 percent.

Retail stocks outperformed with Frasers, the store chain, up 3.0 percent after announcing a share buyback, and H&M, the apparel retailer, up 3.5 percent on positive analyst comments. Among banks, Santander gained 2.6 percent on strong guidance, and UniCredit gained 1.5 percent after completing a sale of Yapi Kredi, the Turkish bank.

On the downside, technology shares were under pressure as inflation worries were stoked by news that Eurozone HICP came in at a record high 7.5 percent annual rate in March, up 1.6 percentage points from February's 5.9 percent and nearly a full percentage point stronger than the market consensus. Travel & leisure and health care lagged too.

Among companies in the news, Sodexo, the food services firm, fell 9.5 percent after the company warned its business was taking a hit from Ukraine effects. On the positive side, Vestas Wind Systems rose 5.2 percent on news of huge orders in the first quarter.

Asia Pacific

Asia-Pacific equities were mixed in quiet trading Friday with Chinese markets outperforming.

Chinese stocks improved on better buying at the start of the new quarter despite data confirming slower economic growth in March. The Chinese CSI 300 index rose 1.3 percent and the Shanghai index gained 0.9 percent. Hong Kong stocks recovered from initial weakness, with the Hang Seng index ending up 0.2 percent.

A poor showing on Wall Street Thursday carried over to Japanese equities on Friday but activity was limited by caution before US employment figures. Japan's Nikkei 225 declined 0.6 percent and the wider TOPIX eased 0.1 percent. Most sectors lost ground, led by marine transportation, along with iron & steel and other natural resources.

The Taiwan Taiex slipped 0.4 percent and the South Korean KOSPI lost 0.7 percent. The Indian BSE Sensex rose 1.2 percent.

Australian equities edged down in quiet trading with sentiment dampened by downbeat Chinese economic data and focus on Chinese economic lockdowns to cope with the pandemic. The All Ordinaries index declined 0.1 percent.

In economic news, the Markit China manufacturing PMI survey's headline index dropped from 50.4 in February to 48.1 in March, below the consensus forecast of 49.5 and indicating activity in the sector contracted at the sharpest pace since the onset of the Covid-19 pandemic in February 2020.

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Global Currency Recap

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