Global equities saw a mixed start to the week as investors braced for a flurry of events including a eurozone interest rate decision, the beginning of earnings season, and key US inflation data.
After a positive performance in most Asian indices, major European bourses posted solid gains, while Wall Street experienced a relatively flat session.ASIA
Steve Sosnick of Interactive Brokers noted that attempts to rally early in the day were unsuccessful, with attention later shifting to the rare solar eclipse, resulting in lighter trading volumes.
Both Paris and Frankfurt stock markets enjoyed gains, with anticipation building ahead of the European Central Bank’s (ECB) upcoming meeting on Thursday. The ECB is expected to keep borrowing rates unchanged but has hinted at a potential shift in policy direction amid improving inflation data.
ING bank economist Carsten Brzeski sees the ECB meeting as a potential turning point for monetary policy in the eurozone, with inflation gradually returning to target levels.
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Market focus will also turn to US inflation data later in the week, which could influence the Federal Reserve’s monetary policy stance. Additionally, the kickoff of first-quarter earnings season, starting with reports from JPMorgan Chase and other major banks, will be closely monitored.
JPMorgan Chief Executive Jamie Dimon’s annual letter to shareholders warned of overvalued US equity markets and highlighted concerns about persistent inflationary pressures.
Meanwhile, gold prices surged to new highs amid ongoing turmoil in the Middle East, while oil prices retreated after recent gains.
According to Patrick O’Hare of Briefing.com, the upcoming corporate earnings season will serve as a crucial test for the stock market rally, with investors closely watching for any signs of weakness amid upbeat economic data.
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