Market Commentary – April 16,2021

Kevin Jock

16th April 2021

    Global indices rallied on Thursday after surprisingly better than expected retail sales and unemployment claims data out of the U.S. Nasdaq recovered previous days losses, the S&P500 settled at fresh record highs and so too did the Dow Jones. Geopolitical tensions between the U.S. and Russia heightened after President Biden ordered fresh sanctions in retaliation for their interference in America’s elections and hacking into SolarWinds. The blacklist includes 32 entities and individuals, and 10 Russian diplomats.

    In Europe, notwithstanding recent COVID-19 and vaccination concerns, rosy earning reports have kept benchmarks upbeat as they followed their American counterparts to new all-time highs. The FTSE100 advances 1% but had yet to reach back to pre-pandemic highs, lagging European markets. Asia opened mix with Australia and Japan weaker whilst Hong Kong rallied, propelled by China’s double digit quarterly GDP data.

    Crude oil post 4 consecutive days of advances, rising by 50 cents yesterday to $63.30 following forecast revisions by the International Energy Agency lifting demand expectations by 230,000 barrels per day. The agency cited “fundamentals look decidedly stronger” as the main factor despite coronavirus still plaguing Brazil, Europe and India.

    The U.S. dollar ended flat yesterday with gold breaking out of consolidation to settle at $1,763. Bitcoin retreats to $61,500 following Coinbase’s IPO frenzy. Despite its already high valuation, renown tech innovation fund Ark Investment has bought 246M worth of Coinbase shares thus far.


Figure 1 (Source: IS Prime) XAUUSD Daily : Gold breaks out of a brief consolidation phase after forming a double bottom to settle beyond previous resistance levels.

Headliner to Review

  • S. retail and core sales came in beyond consensus with expectations at 5.1% and 5.8% respectively whilst actual figures were substantially higher at 8.4% and 9.8%. The exceptional figures come as households aggressively spend their $1,400 stimulus checks. Meanwhile a relaxing of restrictions promptly supported the bar and restaurant industry.
  • Boom in sales helped U.S. unemployment claims decline to 576k, their lowest level since the pandemic began.
  • China’s quarterly GDP came in at 18.3%, up from 6.5%. The strong figures were partly a combination of China’s vaccination program, global exports and government stimulus.

Headliner to Watch

  • American sentiment expected to increase from 84.9 to 88.9. Stimulus package followed by stimulus package alongside one of the fastest vaccination programs among developed economies has fuelled stronger confidence levels.

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Antony Tan
Ben Li
Kevin Jock