Markets Weekly Recap

Markets Weekly Recap

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Key Takeaways

• European indexes reach records, while US stocks trade fairly muted
• Bitcoin remains pressured around the $40,000-mark, Gold breaks above $1,900

The past week brought a slew of events on both sides of the Atlantic as investors once again sought to find value amid the gradual reopening both in the US and Europe. This week, US stocks moved relatively quiet, while European indexes reached new all-time highs. The broad-based pan-continental Stoxx Europe 600 and the German DAX reached new records, fueled by a positive outlook ahead of the economic activity coming back to life.

US investors were largely playing defensive strokes with the equity market as the Federal Reserve became more active in its comments that it expects inflation to be transitory and not exceed 2% this year or the next one. On that front, fairly muted trading narrated the stock market and the movement of the major benchmark indexes. Fed officials this week reassured investors the central bank will maintain its supportive monetary policy despite looming inflation pressures. The policymakers also reiterated there are no plans for imminent changes in the current policies.

Positive Updates for US Jobless Claims

In economic news, US jobless claims on Thursday fell to a new pandemic low in another step toward the anticipated economic recovery. Worker filings for jobless benefits continued to extend a downward trend, according to data from the Labor Department. Initial jobless claims fell last week to 406,000 from 444,000 in the previous week. The latest figure is the lowest level since the onset of the pandemic in March 2020.

US GDP data also highlighted a healing economy fueled by fiscal and monetary support. The US gross domestic product rose in the first quarter at an annual rate of 6.4%, unrevised from the preliminary data. Unemployment in the US, however, remains down by more than 8 million jobs compared with pre-pandemic levels.

On the cryptocurrency front, Bitcoin remained pinned near the $40,000 level throughout the week. The world’s largest coin had several attempts to break over that milestone but buying momentum could not sustain a solid push to the upside. Bitcoin is down by roughly 35% this month but is still trading in the green for the year, up over 33%.

Gold marched higher to a five-month peak, piercing the $1,900 threshold. Weaker US dollar contributed to the rally in the precious metal, combined with the search for a haven amid an uncertain and jittery market environment.