Market Monitor - 30 April 2021
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Market Monitor – 30 April 2021

Global stock markets have managed to consolidate their recent gains this week, with optimism about a return to economic normality over the course of 2021 still the main focus.

But investors’ positivity has been tempered by the growing Covid-19 crisis in India and other developing nations. The World Health Organisation has warned that countries in Europe and North America could see another pandemic surge if they relax restrictions too soon.

As was the case last week, company earnings reports have been the main drivers of share-price movements, although markets also welcomed another announcement from the Federal Reserve in America confirming that with the country’s economic recovery remaining relatively uneven, it would take no steps for the time being to hike interest rates or turn off the monetary stimulus taps.

The US

As was the case last week, company earnings reports have been the main drivers of share-price movements, although markets also welcomed another announcement from the Federal Reserve in America confirming that with the country’s economic recovery remaining relatively uneven, it would take no steps for the time being to hike interest rates or turn off the monetary stimulus taps.

Outside the technology sector, carmaker Ford warned that the global shortage in semiconductors is likely to lead to lower production levels in the current quarter: its shares dropped by nearly 10% on the news.

Overall, though, the US economy continues to recover from the worst of the pandemic: Thursday’s annualised GDP figure of 6.4% was a touch lower than expectations, but it nonetheless means that the American economy is on course to return to its pre-Covid size in the next couple of months.

The UK & Europe

In the UK, the FTSE 100 ended Thursday 1.2% down for the week despite the fact that Britain’s vaccination programme – combined with the first-quarter lockdown – appears to be keeping infection levels under control so far during reopening. The government’s efforts to support the housing market have borne fruit, with property prices continuing to rise, while UK inflation is also on an upward trajectory according to the latest data.

Following the apparent success of the UK’s vaccination programme, analysts at the EY ITEM Club have predicted that the British economy will grow faster in 2021 and return to its pre-pandemic size in the first half of next year, earlier than previously expected.

Solid results from the likes of BP, HSBC, Lloyds and NatWest also helped keep the London market buoyant: UK banks in particular have benefited from the extensive government support for businesses and workers, with the volume of loan defaults generally lower than feared.

In Frankfurt, the DAX index ended Thursday’s session down 0.8% for the week, while France’s CAC 40 gained 0.7%. In Germany, rising inflation and unemployment have spooked investors, while the semiconductor shortage has had a disproportionately large impact on the country’s sizeable manufacturing sector. However, business confidence across the eurozone is on the rise as the European Union’s vaccination roll-out finally clicks into gear.

April 23
April 29
Change (%)
FTSE 100
6938.6
6961.5
0.3
FTSE All-share
3965.2
3977.0
0.3
S&P 500
4180.2
4211.5
0.7
Dow Jones
34043.5
34060.4
0.0
DAX
15279.6
15154.2
-0.8
CAC 40
6257.9
6302.6
0.7
ACWI
703.7
707.2
0.5

Note: all market data contained within the article is sourced from Bloomberg unless stated otherwise, data as at 29 April 2021.

30 April 2021
Mark King
Mark King
Head of Investment Content
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Market Monitor – 30 April 2021

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Important information

This is an advertising document.

Past performance is not a guide to future performance. The value of investments and any income is not guaranteed and can go down as well as up and may be affected by exchange rate fluctuations. This means that an investor may not get back the amount invested. Your capital is at risk.

The analysis included in this document has been produced by Columbia Threadneedle Investments for its own investment management activities, may have been acted upon prior to publication and is made available here incidentally. Any opinions expressed are made as at the date of publication but are subject to change without notice and should not be seen as investment advice. Information obtained from external sources is believed to be reliable, but its accuracy or completeness cannot be guaranteed.

Any opinions expressed are made as at the date of publication but are subject to change without notice. This presentation includes forward looking statements, including projections of future economic and financial conditions. None of Columbia Threadneedle Investments, its directors, officers or employees make any representation, warranty, guaranty, or other assurance that any of these forward-looking statements will prove to be accurate.

The mention of any specific shares or bonds should not be taken as a recommendation to deal.

In the UK: issued by Threadneedle Asset Management Limited, registered in England and Wales, No. 573204. Registered Office: Cannon Place, 78 Cannon Street, London EC4N 6AG. Authorised and regulated in the UK by the Financial Conduct Authority.

Columbia Threadneedle Investments is the global brand name of the Columbia and Threadneedle group of companies.

columbiathreadneedle.com

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