Recap –
The price of the US stocks mostly traded higher last week. The S&P500 increased to reach an all-time closing high, the Dow Jones climbed while the NASDAQ edged lower in an Easter holiday shortened trading week. Slightly higher than expected US GDP figures on Thursday did not dampen the probability of an expected interest rate cut in June. On Friday, broadly in line with expectations US PCE figures may have confirmed this sentiment. Gold prices traded at another record high and Crude Oil’s price jumped to a more than four month peak. Natural gas prices remain subdued, although the commodity pared some losses late last week. Platinum, Palladium and Silver prices finished the week higher.
This Week–
Geopolitical tensions continue to influence market sentiment as traders’ eye events in the Middle East. Israel stated it would launch a ground attack upon Rafah in April or May. Israel’s Monday attack on the Iranian embassy in Syria increased tensions further, after Tehran vowed to respond. But Israel also announced willingness to discuss its next moves with the United States.
On Sunday Chinese factory activity data increased to its highest level in a year supporting Crude oil and provided some support for platinum and palladium prices early this week. The main economic event will be Friday’s Nonfarm Payrolls (NFP) and Unemployment data. The NFP will provide information about whether inflation is under control and clues about when interest rate cuts may take place. Markets expect that an interest rate cut will take place in June. Oil prices have continued to rise this week following positive US Manufacturing data, while traders await the outcome of the OPEC Joint Ministerial Meeting on Wednesday.
Stocks –
FERRARI-
Ferrari’s stock price edged lower by 0.7% but recorded an all-time high last week. Its stock advanced to new highs following reports that the company is accelerating EV development after its deal with South Korean EV battery supplier “SK ON” on March 27th. The company’s solid earnings in February combined with the news that former Formula 1 (F1) champion Lewis Hamilton will be joining the Ferrari F1 team in 2025, could also be seen as important for the “Prancing Horse”.
WALT DISNEY-
Walt Disney's price jumped around 4.2% last week on its way to its highest level since August 2022. Disney’s earnings are not due until May, but the company will hold its annual shareholder’s meeting this week on April 3rd. The meeting may see some changes in the management team and the company may also provide more information about its future strategy and current performance.
Commodities -
Crude Oil
Crude oil price climbed by 2.7% and tested its highest level in almost five months. The breakdown of ceasefire talks between Israel and Hamas continued to concern traders. About 1 million barrels per day of Russian crude capacity remains offline following Ukrainian drone attacks. On Friday the Energy Information Administration stated that US oil production fell by 6% in January this year, compared to December last year.
Gold
Gold price reached new all-time highs on Thursday, but gold bugs were unable to react to Fed Chair Powell’s comments at Friday’s Federal Reserve Bank of San Francisco conference due to the shortened trading week. Powell expressed confidence that inflation is falling towards its 2% target, but said that the Fed won’t cut rates until inflation falls. Gold traders will now be looking to this Friday’s NFP and unemployment rate data for more signs of the Fed’s next moves and high volatility is expected.
Corn
Corn prices climbed to an almost two month high and Friday was the largest one day rally since July last year following new planting data from the US Department of Agriculture forecasts that projected corn plantings in 2024 will be below trade estimates. Earlier this month, China’s corn import was reported to have surged by 16.1% in the January and February periods compared to last year. Corn price has declined so far this year, but March’s returns could be a positive sign for corn traders.
USD/JPY:
The USD/JPY pair inched higher by the end of the trading week but hit its highest level in 34 years. The sharp falls in the Yen came after the National Bank of Japan (BoJ) on March 19th increased interest rates by 0.1%, its first increase in nearly two decades. The latest increase in the currency pair has caused speculation among traders that the BoJ will feel forced to intervene in the markets to support the Yen.