Market Commentary – April 12, 2021

Kevin Jock

12th April 2021

    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.


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.

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Antony Tan
Ben Li
Kevin Jock