Weekly Wrap-Up

Last Week In Markets: Mar 29 - Apr 02 2021

Fisher Investments recaps the biggest market, political and economic news from last week, including US, UK, Eurozone, Japanese and Chinese March Manufacturing Purchasing Managers’ Index (PMI) readings, UK Q4 2020 GDP and US initial jobless claims.

In the US, data were light. The final March Markit Manufacturing Purchasing Managers’ Index (PMI) rose slightly to 59.1, modestly beating expectations (readings above 50 indicate expansion). Initial jobless claims increased to 719,000 for the week ending March 27, above estimates. On Wednesday, President Biden unveiled his proposed infrastructure plan, which would seek to invest about $2 trillion over the remainder of this decade. Whether you love the plan or loathe it, we think there is a big risk of investors overrating the plan’s potential impact on market returns. Even if approved, $2 trillion in projected spending over eight-plus years isn’t stimulus in the here and now. Further, there is no guarantee any of this spending and investment actually happens—a future Congress or presidential administration could alter these plans. For more, please see our 3/31/2021 commentary, “Bullish or Bearish, Keep Expectations of Biden’s Infrastructure Plan in Check.”

In the eurozone, the final March Markit Manufacturing PMI was revised up slightly to 62.5 from the initial estimate of 62.4. In the UK, the second estimate of Q4 2020 GDP fell 7.3% y/y, but rose 1.3% q/q—both better than forecast. February money supply (M4) expanded 13.6% y/y and 0.8% m/m. The final March Markit/CIPS Manufacturing PMI rose to 58.9. Q4 2020 imports and exports increased 11.0% q/q and 6.1% q/q, respectively, both beating expectations.              

In Japan, February imports rose 11.8% y/y, in line with expectations, while exports fell 4.5% y/y, significantly worse than expected. Preliminary February industrial production decreased 2.6% y/y, beating expectations, and 2.1% m/m, worse than forecast. Preliminary February retail sales fell 1.5% y/y, but rose 3.1% m/m. The final March Jibun Bank Manufacturing PMI rose to 52.7. The February unemployment rate remained unchanged at 2.9%. In China, the March Markit/Caixin Manufacturing PMI fell slightly to 50.6, missing expectations.

The Week Ahead:

The US, UK, eurozone and China report final March services PMIs. The US and eurozone release March and February unemployment figures, respectively. China reports March money supply (M2) growth and inflation data. The US also releases February durable goods orders and trade data.

Tip of the Week:

Fisher Investments’ offices and US markets will be closed on Friday, April 2 in observance of Good Friday.

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 the maximum rate applicable to non-resident institutional investors who do not benefit from double taxation treaties. Past performance is no guarantee of future results. A risk of loss is involved with investments in stock markets.