Daily market review

United States

With equity markets on holiday Friday, US economic indicators came in strong. Industrial production jumped 0.9 percent in March, well above the 0.4 percent Econoday consensus forecast. Manufacturing rose 0.9 percent too, with a boost from a 7.8 percent surge in autos and parts production. Capacity utilization topped expectations as it rose to 78.3 percent. Separately, the US Empire State manufacturing index rocketed by 36 points to 24.6, far above expectations centering on 2.0. Expectations were much weaker, with the six-month outlook index slipping to 15.2 in April from 36.6 in March.

In markets, the dollar appreciated vs. most currencies, with a lift from the positive US economic data. Commodities and US Treasury markets did not trade.


Equities were on holiday. In economic data, French inflation rose sharply in March. A final 1.4 percent monthly increase in prices was in line with the provisional estimate and lifted the annual rate from February's final 3.6 percent to 4.5 percent, its highest mark since December 1985.

Asia Pacific

Asia-Pacific equities weakened Friday on disappointment that the People's Bank of China did not cut interest rates as some expected.

Investors also focused on hawkish comments from Federal Reserve officials Thursday, including New York Fed President John Williams' remark that a 50-basis point rate increase would be "a very reasonable option" in May.

Williams, who is regarded as relatively dovish, also told Bloomberg TV, "From a monetary policy point of view, it does make sense for us to move expeditiously towards more normal levels of the federal funds rate, and also (to) move forward on our balance-sheet reduction plans."

Equities trading was limited by holidays Friday in Australia, Hong Kong and India.

Mainland Chinese equities declined after the PBOC opted to cut bank reserve ratios but left rates steady. The bank cut the required reserve ratio by 0.25 percentage point in a bid to boost bank lending. Some observers expected a more aggressive step to offset the impact of anti-Covid lockdowns. China's CSI 300 declined 0.1 percent and the Shanghai index slipped 0.5 percent.

Carryover from Wall Street's growth stock selloff undercut Japanese equities with declines centered in big-cap tech stocks. Japan's Nikkei 225 declined 0.3 percent and the TOPIX lost 0.6 percent.

Thursday's US tech stock selloff hurt South Korean equities too, with the KOSPI down 0.8 percent, and the Taiwan Taiex off 1.4 percent. In Taiwan, bellwether Taiwan Semiconductor Manufacturing declined 1.9 percent to weigh on the market.

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