Market Monitor – 28 April 2023

Market Monitor – 28 April 2023

Global stock markets have struggled to make significant headway this week, although early losses were recovered to some extent – thanks to a rally on Thursday

The re-emergence of concerns about the resilience of the United States’ banking system on Monday and Tuesday created nervousness among investors. Meanwhile, recent data indicated that activity in some of the world’s largest economies remains under considerable pressure from high inflation and tight monetary policies. However, a number of upbeat company earnings statements later in the week helped markets stage a partial recovery.

United States

On Wall Street, the Dow Jones Industrial Average ended trading on Thursday 0.1% up for the week so far, with the S&P 500 finishing level with last Friday’s close. There was much to concern investors in the US this week: Treasury secretary, Janet Yellen, warned on Tuesday that the American economy was likely to be damaged if lawmakers in Washington DC were unable to agree on raising the government’s debt ceiling in the coming weeks, while data published on Thursday showed that US GDP had increased by just 1.1% in the first three months of the year. However, bullish trading statements from some of the world’s biggest technology businesses later in the week helped to calm nerves.

UK

In the UK, the FTSE 100 closed on Thursday 1% lower for the week so far, with softening commodities prices continuing to hold the index back. There were some bright spots, including better-than-expected results from major banks, and latest figures suggesting retail sales had recovered to some extent in April. However, reports of a new round of fresh-produce shortages raised fears of further price rises, while the Bank of England attempted to encourage wage restraint among workers and employers as it battles to bring inflation under control.

Europe

In Frankfurt, the DAX index ended Thursday’s session 0.5% down for the week, while France’s CAC 40 lost 1.2%. European banking sector shares declined following the jitters in the US, while uncertainty continues to surround the forthcoming interest rate decision from the European Central Bank. The size of its next rate hike is likely to depend on how far inflation has fallen in April, with figures for the individual eurozone nations as well as the bloc as a whole due to be published over the next few days.

Asia

In Asia, the Hang Seng index in Hong Kong dipped 1.2%, extending recent losses as investors remained concerned about the pace of the post-pandemic economic recovery – and the likelihood of further government stimulus measures. However, technology stocks performed well following the positive news from the US, while there were gains among insurance company shares after solid earnings reports from the sector. Japan’s Nikkei 225 index of leading shares fell back 0.4%, despite having hit an eight-month high earlier in the week thanks to the strength seen among semiconductor and motor manufacturers.

21 April
27 April
Change (%)
FTSE 100
7914.1
7831.6
-1.0
FTSE 250
19270.0
19248.0
-0.1
S&P 500
4133.5
4135.4
0.0
Dow Jones
33809.0
33826.2
0.1
DAX
15881.7
15800.5
-0.5
CAC 40
7577.0
7483.8
-1.2
ACWI
652.6
650.5
-0.3
Hong Kong Hang Seng
20075.7
19840.3
-1.2
Nikkei 225
28564.4
28457.7
-0.4

Note: all market data contained within the article is sourced from Bloomberg unless stated otherwise, data as at 27 April 2023.

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28 April 2023
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Global stock markets had a difficult week, with technology stocks in particular giving up some of their recent gains.
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