The new week in the financial markets began with better than anticipated inflation reports from Japan, where the PPI outdid the forecast twice by climbing to 0.8% MoM and 1% YoY.
China’s loan report was also surprisingly positive, revealing a much higher than anticipated yuan loans amount. In addition, the stock market in Hong Kong took a breather after Alibaba was issued a much smaller fine than expected over the weekend, indicating that it may have avoided big trouble with the Chinese government.
Furthermore, the eurozone presented its retail sales data for February, which showed a much smaller drop than expected, at -2.9% (versus a forecast of -5.4%).
There is also a lot of optimism about the US market, because Federal Reserve Chair Jerome Powell shared last night that the country is likely headed for a speedy economic recovery. This is the first time Powell has acknowledged that the situation has changed significantly in the United States and may signal the readiness of the Federal Reserve to tighten monetary policy before 2023.
Still, today we expect all major US stock indices to trade slightly lower in preparation for multiple earnings reports from US-based companies this week. Thanks to the gradual reopening of the economy of the United States, the earnings reports are expected to be more positive compared to the preceding quarter.
Things are also looking up in the United Kingdom, another country that is leading the world in terms of the percentage of the population it has vaccinated against Covid-19. Non-essential business in the UK will finally reopen, together with the outside spaces of all restaurants.
However, the situation is much worse in India. The country declared almost 170,000 new infections with the coronavirus yesterday alone, it’s all-time highest record, and the latest in a series of increasing daily numbers. It might not even be the peak, considering the latest trends in the country.
India is the second most-affected country in the world with over 13.5 million total coronavirus infections. The total number of Covid-19 cases since the start of the pandemic globally has surpassed 136.7 million, with lethalities approaching 3 million.
