Market Commentary - April 12, 2021

Posted by Kevin Jock on Apr 12, 2021 7:34:12 AM

    Asia-pacific stocks and overnight futures retreated on open following words of overnight optimism from the Federal Reserve Chairman. In an interview on 60-minutes Powell said the U.S. economy is at an “inflection point” with economic growth and job prospects stronger despite the risk of COVID-19.

    Australia’s S&P200 slipped 0.4% as Prime Minister refrained from setting new vaccination goals after AstraZeneca’s blot clot concerns, delaying the rollout. Meanwhile, the Japanese Nikkei followed suit after Yaskawa Electric, seen as a leading indicator for the manufacturing sector, failed to meet earnings expectations.

    China’s record $2.8bn antitrust violation fine on Alibaba Group spooked Hong Kong’s Hang Seng with the benchmark declining 1.4% on open. Previously turning a blind eye, Beijing as of late has stepped up scrutiny on deal-making and anti-competitive practices among technology juggernauts to ensure a chokehold on Chinese tech billionaires empires.

    Ahead of reporting season, Wall Street ended Friday with 3 consecutive weeks of advances. A plethora of fiscal and monetary stimulus alongside a successful vaccination program has spurred on positive sentiment. Still, company outlook surrounding President Biden’s corporate tax hike could dent expectations. Elsewhere, the bull run across European markets continued higher despite a lagging vaccination program offsetting growth prospect. In contrast, the FTSE100 ended the session lower even though on Monday non-essential shops and services will welcome back customers as lockdown restrictions ease.

    The dollar gained among a basket of majors, crude closed below $60 and gold at $1,743. Bitcoin back below $60,000 after surging to $61,000 over the weekend as investor exuberance gear up for Coinbase’s public listing, currently valued at $100bn pre-IPO.

nasdaq-Apr-12-2021-06-31-43-43-AM

Figure 1 (Source: IS Prime) Nasdaq Daily : Nasdaq just shy off all-time highs as it catches up to cyclicals following 2 months of underperformance when investors rotated out of tech.

Headliner to Review
  • Canada added more jobs than anticipated with employment change at 303.1K and the unemployment rate declining from 8.2% to 7.5%. Though concerns over next month’s report amid fresh lockdowns imposed recently.

Headliner to Watch

  • Bank of Canada to release their business outlook survey today which is composed 100 businesses in relation to their prevailing business environment.
  • With treasury yields in focus, todays 10-year bond auction will be on keen interest. A lack of demand would imply higher inflationary pressure in the long-term.
  • China’s trade balance is expected to halve from 676B to 330B after last months above normal spike.

Any opinions, news, research, analysis, prices, or other information contained on this website is provided as general market commentary, and does not constitute investment advice.

Authors:
Antony Tan
Ben Li
Kevin Jock

Topics: Market Commentary

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