Market Perspectives
U.S. equity markets ended a volatile, holiday-shortened week higher, supported by tentative signs of de-escalation in the Middle East. The Nasdaq Composite led gains, rising 3.95% and marking its strongest weekly performance since November, while the S&P 500 and Dow Jones Industrial Average advanced 3.36% and 2.96%, respectively. Fixed income markets moved in tandem. U.S. Treasuries rallied, as investors reassessed the near-term inflation and policy outlook. Across the Atlantic the pan-European STOXX Europe 600 rose 3.92%, with Germany’s DAX up 3.89%, Italy’s FTSE MIB gaining 5.18%, France’s CAC 40 advancing 3.48% and the UK’s FTSE 100 adding 4.70%. Asia lagged in the global rebound. Japan’s Nikkei 225 declined 1.7%, while Hong Kong’s Hang Seng posted a modest gain of 0.66%. Looking ahead, the focus shifts to inflation. A heavy data calendar — including U.S. March CPI, China’s factory-gate prices and the Federal Reserve’s March FOMC minutes — should offer early insight into the extent of energy-driven price pressures stemming from the Iran conflict. Yet, as in recent weeks, the dominant driver of markets remains geopolitical. The trajectory of the conflict — and President Donald Trump’s next moves — will continue to shape sentiment. Does the rebound mark the beginning of a more durable recovery, or is it merely another tactical bounce?
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BONDS & MACROECONOMICS
U.S. Treasuries rallied as investors reassessed the near-term inflation and policy outlook in tandem with the equity rebound.
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