Weekly Extract 12/04/2021

Weekly summary from April 05 to 09

• The US equity market closed the week on a positive note. The S&P500 and the Dow Jones have reached new highs. According to a Bank of America report, equity investors have invested more money in the last five months than in the last 12 years.
• In Europe, the week closed positively for the main equity indices. This week's gains have left new highs for the EuroStoxx 50 index touching 4,000 points. On the other hand, the euro has had its best week so far this year, rising 1.2%.

To be taken into account

• As a first point, investors' attention will be focused on the beginning of the presentation of corporate results. The big U.S. banks will be in the spotlight, including JP Morgan, Wells Fargo, Goldman Sachs, Bank of America and Citi. Analysts expect earnings for the first quarter of this year to be up 24.2% from last year's first quarter earnings. Last quarter, about 80% of companies beat fourth-quarter 2020 earnings estimates. However, only 42% saw an increase in share price on the day they reported their results.
• Among the economic data expected to be released during the week, the focus will be on the release of consumer price inflation (CPI) data and retail sales data in the U.S. However, analysts will be looking for signs that massive fiscal spending is stimulating inflation.
• In an interview published on Sunday night 11, Jerome Powell has mentioned that the U.S. economy is currently at an inflection point. He believes that the economy is going to start growing at a much faster pace than expected as well as job creation. He also stated that the main risk to the economy is that COVID-19 will spread again due to an early economic reopening.
• Microsoft is in advanced talks to acquire speech recognition company Nuance Communications. The acquisition, which would be worth approximately $16 billion, would help expand Microsoft's capabilities in speech software.
• U.S. economic and national security advisors will meet with more than a dozen CEOs on Monday to discuss the Joe Biden administration's proposed infrastructure plan and about the semiconductor shortage that is affecting the auto industry.
• On April 14, cryptocurrency trading platform Coinbase is expected to go public (it will do so through a direct listing on the NASDAQ). The company has recently presented results for the first quarter of this year; those present how its revenues have exceeded by 840% those presented in the same period of 2020.

Other important points

• The United Kingdom takes an important step in its economic reopening this Monday 12th, with the opening of non-essential retail and leisure sites. Additionally, pubs and restaurants will be enabled to serve people outside the premises. The country is also approaching a key milestone, when so-called herd immunity could be achieved through nearly three-quarters of the population having antibodies to Covid-19.
• In Asia, the focus will be on Q1 GDP growth data to be released on Friday 16. The data is expected to show an increase of up to 201 q/q3 (y/y). Against this backdrop, investors may fear that policymakers will backtrack on current monetary conditions.
• China's government imposed a record $2.8 billion fine on Alibaba Group after an antitrust investigation found it abused its market dominance. The company must initiate "comprehensive rectifications," ranging from protecting merchants and customers to strengthening internal controls.
• Ant Group, the financial technology subsidiary of Alibaba Group Holding Ltd has reached an agreement with China's central bank. The agreement deals with restructuring as a financial business holding company. Under the terms of the agreement with the central bank, Ant will eliminate the "inappropriate" linkage between the AliPay payments service, the Jiebei virtual credit card product and the Huabei consumer credit product.
• According to Al Masirah TV, Yemen's Houthi movement said early Monday that it had sent 17 drones against Saudi targets, including 10 that were launched toward Saudi Aramco refineries in Jubail and Jeddah.