Market Commentary – April 28, 2021

Kevin Jock

28th April 2021

    Wall Street took a pause near record highs as investors digest quarterly earnings and brace for FOMC tonight. Nasdaq underperformed slipping 0.5%, dragged lower by Microsoft and Tesla, whom despite earnings beating expectations have sold-off. Federal Chairman Powell is expected to repeat his longstanding message that irrespective of inflationary pressures, policy will remain accommodative until the economy and labour market recovers. Though a potential recalibration in quantitative easing could be on the horizon especially as the Bank of Canada last week become the first of G7 central banks to began scaling back purchases.

    Results were mixed in Europe, but overall market action was subdued. The European Parliament will vote on the Brexit trade deal to approve the agreement and allow the EU to punish Britain with tariffs should post-Brexit obligation fail to eventuate. Meanwhile, the European Commission proposed new rules in response to the competitive threat foreign state-owned companies pose against domestic counterparts.

    In Asia, the Japan’s Nikkei edged higher on better-than-expected retail sales figures. Australia’s S&P200 up 20 index points as inflationary pressures disappoint consensus giving ammunition for the RBA to remain accommodative.

   Despite global demand outlook being uncertain arising from uncontrolled outbreaks in India, Brazil and now Philippines. The OPEC+ meeting concluded with member states in agreement to progressively increase production in the coming six months by 5.2m barrels a day. Still, crude rallied just over $1 to $62.95 on the news.

   The U.S. dollar gained against a basket of majors as investors speculate potential groundwork could be laid by the Federal Reserve in tightening overall monetary policy. Elsewhere bitcoin closed back above $55,000.


Figure 1 (Source: IS Prime) XPDUSD Daily : Palladium set to post 3 consecutive weeks of advances as supply remains tight.

Headliner to Review

  • Consumer confidence in the U.S. jumped from 109 to 121.7 beyond consensus as positive sentiment is spurred by the success of vaccinations and on-going government expenditure.
  • Quarterly CPI figures disappoint in Australia posting 0.6% whilst 0.9% was expected. The biggest contributor to price increases was automotive fuels however was offset by a bigger than anticipated fall in durable goods.

Headliner to Watch

  • Canadian retail sales is expected to expand 4.0% following further easing in social distancing measures.
  • Crude inventory set to go back into deficit from 0.6M to -0.9M. despite the likes of India and Brazil clouding global demand.
  • The Federal Reserve will announce their monetary policy today, with no changes expected to either the policy rate or purchases, but speculation is rife that outlook may turn less dovish.

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.

Antony Tan
Ben Li
Kevin Jock