Investors paused for a second day after the Fed’s fed funds move.
United States
US stocks barely moved Friday for a second day. Gains for dividend-paying stocks offset drops for banks and health care. Both the Dow Jones industrials and S&P slipped 0.1 percent while the Nasdaq was virtually unchanged (up 0.24 point). Investors continued to wait to see if Washington will be able to deliver on promises to cut taxes and at the same time boost infrastructure spending to boost the economy. For the week, the Dow inched up 0.1 percent, the S&P was up 0.2 percent and the Nasdaq added 0.7 percent.
Amgen retreated after results from a study of its cholesterol drug Repatha disappointed investors. Adobe surged after reporting stronger revenue and earnings for its latest quarter than expected. Tiffany jumped after reporting better profit than expected for its latest quarter. Strong demand in China and Japan helped to offset flagging sales at home.
A meeting of G20 finance ministers and central bank governors being held in Germany on Friday and Saturday also kept some traders on the sidelines.
February industrial production was unchanged on the month thanks to declines in utilities because of warm weather during the month. However, manufacturing jumped 0.5 percent for a second month. Preliminary March consumer sentiment climbed to 97.6 from February’s final reading of 96.3.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was up 25 US cents to US$1,229.60. Copper futures were up 0.5 percent to US$2.69. WTI spot crude was up 3 US cents to US$48.78. Dated Brent spot crude was up 2 US cents to US$51.76. The US dollar was up against the euro and the Swiss franc. The currency declined against the pound, yen and the Australian dollar. It was unchanged against the Canadian dollar. The Dollar Index was up 0.1 percent. The yields on both the US Treasury 30 year bond and 10 year note were down 3 basis points to 3.11 percent and 2.50 percent respectively.
Europe
Most markets advanced but finished little changed overall after the weak start in the US markets dragged the European markets back near the flat line. The FTSE and DAX edged up 0.1 percent, the CAC gained 0.3 percent and the SMI added 0.4 percent. On the week, the FTSE and DAX were up 1.1 percent, the CAC advanced 0.7 percent and the SMI was 0.3 percent higher. Investors were somewhat cautious ahead of a meeting of G20 finance ministers and central bank governors being held in Germany on Friday and Saturday.
Eurozone short-dated bond yields hit five-week highs after ECB governing council member Ewald Nowotny signaled that the European Central Bank could raise its deposit rate which is currently below zero either before or after it ends its bond-buying stimulus program. The news also provided a boost to shares of European banks.
E.ON gained after raising €1.35 billion through issuance of 200 million new shares as part of a capital increase. Fraport rose after reporting a 35 percent rise in fiscal 2016 net profit. Stada was lower after it said it postponed the structured bidding process to give rival bidders a chance to improve their offers on the decision of the Supervisory Board. Airbus was lower after French authorities opened a preliminary investigation into allegations of fraud, bribery and corruption in the civil aviation business of Airbus Group relating to irregularities concerning third party consultants.
Berkeley Group Holdings jumped after the homebuilder said it expects its pre-tax profits for the year ended April 30, 2017 to be at the top end of expectations. Barclays advanced on a broker upgrade. AstraZeneca increased after the U.S. Food and Drug Administration rejected its new drug for high potassium levels in the blood. Tullow Oil sank after the energy major announced plans to raise about £607 million by way of a rights issue. Royal Bank of Scotland gained on a broker upgrade.
Asia Pacific
Stock indices were mixed Friday as the US dollar continued to slide while oil prices steadied after comments from Saudi Energy Minister Khalid al-Falih that output cuts may be extended if stockpiles remain above average.
The Shanghai Composite dropped 1.0 percent a day after People’s Bank of China raised short-term interest rates to avoid downward pressure on the yuan and manage capital flows, The Hang Seng edged up 0.1 percent. On the week, the Shanghai Composite was up 0.8 percent and the Hang Seng added 3.1 percent.
The Nikkei and Topix declined 0.3 percent and 0.4 percent respectively. On the week, they lost 0.4 percent and 0.5 percent. Japanese shares fell as the yen steadied prior to the G20 finance ministers’ meeting in Germany. Exporters including Panasonic, Toyota Motor, Hitachi and Mazda Motor declined. Toshiba rallied after reports that its memory chips business is attracting more potential bidders.
The All Ordinaries and S&P/ASX both added 0.2 percent. The former was up 0.5 percent on the week while the S&P/ASX was 0.4 percent higher. Gold miners gained after gold futures settled at their highest level in two weeks overnight. The big four banks were higher on expectations they will benefit from higher interest rates. Slater and Gordon soared after the law firm said its new creditors are supportive of a restructuring plan. Miners lost ground, with BHP Billiton and Fortescue Metals Group declining.
The Kospi rallied 0.7 percent and was 3.2 percent higher for the week as foreign investors extended their buying streak for the 10th straight session. The Sensex was up 0.2 percent and 2.4 percent on the week.
Looking Forward

Central Bank activities

March 23

New Zealand

Reserve Bank of New Zealand Monetary Policy Announcement

The following indicators will be released this week…

Europe

March 20

Germany

Producer Price Index (February)

March 21

UK

Consumer Price Index (February)

Producer Price Index (February)

March 23

Eurozone

EC Consumer Confidence (March flash)

UK

Retail Sales (February)

March 24

Eurozone

PMI Manufacturing, Services & Composite PMI (March flash)

Germany

PMI Manufacturing, Services & Composite PMI (March flash)

France

PMI Manufacturing, Services & Composite PMI (March flash)

Gross Domestic Product (Q4.2016)

Asia Pacific

March 22

Japan

Merchandise Trade Balance (February)

March 24

Japan

PMI Manufacturing (March flash)

Americas

March 21

Canada

Retail Sales (January)

March 22

United States

Existing Home Sales (February)

March 23

United States

Initial Unemployment Claims (week ending prior Saturday)

New Home Sales (February)

March 24

United States

Durable Goods Orders (February)

PMI Manufacturing, Services & Composite PMI (March flash)

Global Stock Markets

*Note — all releases are listed in local time.

Source: Fidelity

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