Global equities ended the week 0.5% higher. US economic releases were positive. The Conference Board’s Leading Economic Index (LEI) increased 0.3% m/m in March—in line with forecasts. Two of the LEI’s most forward-looking indicators—the yield spread and ISM New Orders—were the biggest contributors, signaling future growth. Retail sales rose 4.5% y/y in March, ahead of expectations. March industrial production increased 4.3% y/y with manufacturing output—the largest component—rising 3.0% y/y. Volatile housing starts grew 1.9% m/m in March, rebounding from a 3.3% m/m decline in February. In the eurozone and UK, March core consumer prices (excluding energy, food, alcohol and tobacco) rose 1.0% y/y and 2.3%, respectively. UK March retail sales grew 1.1% y/y—missing expectations of 2.3% y/y. The UK unemployment rate fell to a 42-year low of 4.2% in the three months ending in February. In Japan, March core-core consumer prices (excluding food and energy) rose 0.5% y/y. Preliminary March trade data showed imports decreased 0.6% y/y and exports increased 2.1% y/y. February industrial production rose 1.6% y/y. In China, the first estimate of Q1 2018 GDP reported 6.8% y/y growth. March retail sales beat forecasts, increasing 10.1% y/y. Industrial production rose 6.0% y/y in March, missing expectations. The People’s Bank of China announced a 100 basis point cut to its reserve requirement ratio for banks. The cut is targeted at improving access to credit for small businesses and is scheduled to take effect on April 25.
The US and eurozone release April manufacturing and services Flash Purchasing Managers’ Indexes (PMIs). The US and UK report the first estimates of Q1 2018 GDP. Japan announces March unemployment, retail sales and the April manufacturing Flash PMI. The European Central Bank and the Bank of Japan meet to determine their respective monetary policies.
Source for all data cited is FactSet. This update constitutes the general views of Fisher Investments and should not be regarded as personalized investment advice. No assurances are made we will continue to hold these views, which may change at any time based on new information, analysis or reconsideration. In addition, no assurances are made regarding the accuracy of any forecast made herein. Global equities are represented by the MSCI World Index. The MSCI World Index measures the performance of selected stocks in 23 developed countries and is presented net of dividend withholding taxes and uses a Luxembourg tax basis. Past performance is no guarantee of future results. A risk of loss is involved with investments in stock markets.