Equities closed out the quarter by posting a weekly gain as the S&P 500 gave a positive return for the sixth consecutive quarter. However, the week ended on a cautious note as investors continue to assess the ability of the US administration to follow through on its election promises.
Brexit was formerly invoked as the UK triggered Article 50 of the Lisbon Treaty. The market reaction was muted, as participants will closely watch the protracted negotiations going forward. Comments from Federal Reserve representatives in the US kept to the script of the potential for three or four interest rate hikes this year.
Global bond markets saw gains last week, with yields (which move inversely to price) moving lower as US policy and European election concerns remain in focus. In commodities, crude was headed for the biggest weekly gain this year on speculation OPEC will extend its deal to curb output.
The global index finished the quarter with a weekly gain of 1.4%, leaving the return for the first three months of the year just short of 5.5%. Gold, silver, and copper all saw weekly gains, and have delivered positive returns year-to-date. Oil was higher on further OPEC comments, returning just short of 5.5%; however it does remain in negative territory for 2017.
The US 10-year bond price moved higher, as the yield went from 2.41% to 2.39% over the course of the week. The equivalent German yield followed, finishing at 0.33% from 0.40% a week earlier.
The week ahead
Wednesday 5th April:
UK services PMI (purchasing managers' index) data is expected to edge down from 53.3 to 53.2, which will signal a continuing expansion, albeit at a slower rate.
Thursday 6th April:
The minutes of the ECB's March meeting are released. The contents could be of interest to the market if there is language in relation to potential changes to the current interest rate policy.
Friday 7th April:
In the US, the March non-farm payroll figure is expected to come in at 174,000, with the unemployment rate steady at 4.7%.