The Euro strengthened to a two year high, and has now held above the $1.15 mark. This was despite assurances from ECB President Mario Draghi that the central bank is in no rush to rein in quantitative easing just yet. The Dollar index (which measures the US Dollar against a basket of currencies) declined to a 10 month low last week, as the political furore in the US over the Healthcare Bill and the Russian investigation continued unabated.
With roughly 20% of the S&P 500 reporting by the end of last week over three quarters of firms had exceeded bottom-line expectations, with the Tech and Financials sectors helping to lead the way.
On the economic data front, the US Conference Board's index of leading economic indicators increased in June for the sixth consecutive month, whilst US Housing starts also saw encouraging numbers.
The global index returned -1.2% for the week, as the stronger euro negated positive local currency returns. Commodities in general enjoyed a positive week, as Gold (+2.1%) and Copper (+1.2%) closed higher. And oil fell just over 1.5% but held above the $45 mark.
US 10 year Treasuries prices moved higher, with the yield (which moves inversely to price) moving to 2.24%, from 2.33% a week previously, based on the aforementioned political risk.
The EUR/USD rate closed at $1.17, whilst EUR/GBP was at £0.90.
The week ahead
Monday 24th July - Friday 28 July:
Earnings continue to come in thick and fast with Facebook, Coca Cola, Nestle and Amazon all reporting.
Wednesday 26th July:
No change is expected at the July Federal Reserve FOMC meeting, with the target funds rate to be kept at 1.0-1.25%.
Friday 28th July:
Japanese inflation and unemployment data goes to print, where CPI is expected to slip to 0.3% (year-on-year) and unemployment is forecast to come in at 3.0%.