To start your trading week, let us have a peek at what the global market sentiment will be like this week through our Week In Review.
Along with worries about how tighter monetary policy will affect the economy, the war in Ukraine will keep making the news.
Adding to the pressure on stocks, the ongoing conflict is driving up the price of a variety of commodities, including oil, fueling inflation that began during the COVID lockdowns, causing a global supply crunch.
Here’s what you should know.
Oil Price Flip Flops
After U.S. President Joe Biden announced a release of 1 million barrels per day of oil for six months starting in May, both Brent and U.S. crude oil closed last week by around 13%. This is their largest weekly decline in two years. Meanwhile, the announcement by Biden is part of what is to be the largest ever release from the U.S. Strategic Petroleum Reserve.
Due to Russia’s invasion of Ukraine, oil prices rose over 30% in the first quarter, driving up inflation predictions.
But energy market analysts appeared skeptical of the plan’s success.
The minutes of the Fed’s March meeting, which will be released on Wednesday, will provide investors with an update on how officials view the monetary policy outlook. Additional information on plans to reduce the central bank’s $9 trillion balance sheet.
With inflation at a four-decade high, the Fed raised rates by 0.25 percentage points last month. To avoid a spike in inflation, several Fed officials, including Chair Jerome Powell, have signaled they are willing to raise rates more quickly than in March.
Friday’s strong employment data smoothed the way for the Fed to boost rates by half a percentage point at its next meeting on May 4.
Several Fed officials, including Fed Governor Lael Brainard; Minneapolis Fed President Neel Kashkari; New York Fed President John Williams; and St. Louis Fed President James Bullard, are also scheduled to speak this week.
Bitcoin Closed Higher
Bitcoin closed higher for the third week in a row, the first time since February. After completing an H&S top between August 2021 and January 2022, the digital token has been moving in a rising range since the Jan. 24 low.
The price has risen back above $45,000 and has been trending upward in recent weeks, with a 15% increase in the last week alone.
The current rise extends a surge that began earlier this month following the Federal Reserve’s announcement that interest rates would be raised for the first time in three years.
Bitcoin had been stuck below $40,000 after rising 10% to more than $42,000 following President Joe Biden’s signing of a sweeping executive order on cryptocurrency on March 9, which calls for government agencies to develop a plan to regulate cryptocurrency and to consider a government-issued central bank digital currency.
It is the White House’s first real move toward regulating cryptocurrency, which has become a big part of the war in Ukraine and has caused more volatility in the crypto and stock markets.
Keep an eye on the market prices and while you wait for your trade breakout, take advantage of the Juno Markets Economic Calendar to keep yourself updated with the market’s most important economic news events. https://www.junomarkets.info/en/resources/economic-calendar/
The Week Ahead
All times listed are EDT.
China’s markets were closed in observance of the Ching Ming Festival.
5:05: UK – BoE Gov Bailey Speaks
Hong Kong and China markets were closed in observance of the Ching Ming Festival.
00:30: Australia – RBA Interest Rate Decision: forecast to remain steady at 0.10%.
4:30 p.m.: UK – Services PMI: expected to remain unchanged at 61.0.
10:00: US – ISM Non-Manufacturing PMI: predicted to edge up to 58.0 from 56.5.
4:30: UK – Construction PMI: anticipated to ease to 57.3 from 59.1.
10:00: Canada – Ivey PMI: previously printed at 60.6.
10:30: US – Crude Oil Inventories: last week’s release showed a drawdown of -3.449M.
14:00: US – FOMC Meeting Minutes
7:30: Eurozone – ECB Publishes Account of Monetary Policy Meeting
8:30: US – Initial Jobless Claims: expected to retreat to 200K from 202K.
8:30: Canada – Employment Change: likely plummeted to 80.0K from 336.6K.