Interest Rates Strengthen with Services Sector Growth
The latest data on global business activity reveals a widespread increase in the services sector, particularly in the United States, supporting the case for continually rising interest rates.
S&P 500 and Nasdaq Futures Dip Ahead of Earnings Week
S&P 500 and Nasdaq futures declined by 0.4% in preparation for a week of earnings announcements, while the STOXX 600 remained mostly unchanged during early trading in Europe.
MSCI All-World Index Retreats but Remains Strong Overall
Despite the MSCI All-World index slipping by 0.1%, it has climbed almost 1% in April and remains close to its one-year high, mainly due to the strength of U.S. tech stocks.
Apple and Microsoft Earnings Crucial for S&P 500 Gains
Apple and Microsoft have been responsible for nearly half of the S&P 500's growth in the past month, making their upcoming earnings reports vital to the index's performance.
Big Tech Reports Set to Test Nasdaq 100's Outperformance
Michael Hewson, the chief market strategist at CMC Markets, says that the Nasdaq 100's outperformance this year will face a significant challenge as Microsoft, Alphabet, Meta Platforms, and Amazon report their earnings this week.
Debt Ceiling Debate Looms in U.S. House of Representatives
The U.S. House of Representatives may vote on a Republican proposal to raise the debt ceiling in exchange for spending cuts, as weak tax receipts indicate that the government could run out of money sooner than expected.
Markets Anticipate Central Bank Rate Decisions
Market participants are factoring in an 86% chance of the Federal Reserve raising rates by a quarter point in May, with similar expectations for the European Central Bank, the Bank of Canada, and the Swedish central bank.
Bank of Japan's New Governor Faces First Meeting
The Bank of Japan will hold its first meeting under the leadership of new governor Kazuo Ueda, who has stated that policy easing must continue as inflation remains below 2%.
Euro Zone Borrowing Costs Expected to Rise
Pierre Wunsch, an ECB policymaker and head of Belgium's central bank, believes investors underestimate how much euro zone borrowing costs will increase, only agreeing to pause rate hikes once wage growth shows signs of slowing.
Currency and Commodity Market Updates
The euro remained mostly steady against the dollar and yen, while the dollar saw a minor increase against the Japanese currency. Chicago wheat prices rose nearly 1% due to concerns over Russian threats to terminate a Ukrainian grain export deal. Meanwhile, Brent crude oil prices struggled to stay above $80 a barrel amid investor concerns about energy demand in a high-interest-rate, inflationary environment.