Please find the latest edition of Weekly Digest attached.
Last week saw central banks give broad reassurance that they will allow an extended economic cycle, however, interest rates in the US continue to test equity investors’ patience. As a result, there was a risk-off tone and global markets fell by 0.4% in US dollar terms. UK equities underperformed on the week, falling by 0,.6%. That said, the FTSE All Share has risen by 5% year-to-date in sterling, which compares to a rise of 3% for the MSCI World Index. Sectorally, there were few strong trends. Technology performed in-line with averages and the (technology heavy) Nasdaq Index matched the 0.7% fall of the S&P 500. Financials performed in-line globally also, although they have outperformed strongly this year-to-date. Oil sold off by 7% after a spike in the previous week, driven by an attack on the Saudi refinery centre. Gold recovered some of its recent weakness in spite of rising yields, rising by $17.
The UK vaccination rate surged last week, with the number of shots given going from 38% to 43% of the population. The US is at just under 37%, and the US and the UK are vaccinating at a rate of 5% of the population per week. Thirty six countries have now given vaccinations to more than 10% of their populations, up from thirty last week. On the negative side, the seven-day average of global new cases has ticked up for the second week (to 461,000 from 412,000). Europe is said to be considering preventing exports of the vaccine produced in the EU as it faces a third wave, with Germany proposing four more weeks of lockdown after relaxing curbs at the end of February. A US study has reported that the Astrazeneca vaccine prevents 79% of symptomatic cases, and that it is 100% effective against severe disease or hospitalisation.
The key events for the week ahead will be the release of global PMI (Purchasing Managers Indices) data along with testimony from Jerome Powell and Janet Yellen to Congress (Tuesday and Wednesday). Other highlights include UK unemployment data on Tuesday and UK inflation data on Wednesday. This will be followed by the US Q4 GDP revision on Thursday, then UK Retail Sales for February and US Consumer Sentiment data for March on Friday. In terms of corporate news, we have updates from Adobe, Keywords Studios and Compass Group.