The first quarter, which ended last week, was the best for the US stock market since 1998. The recovery of quotations observed during this period was due to their drawdown at the end of 2018. Despite the uncertainty on the world’s leading markets and the slowdown in the global economy, shares remain an attractive asset.
On Friday, the main US indices increased in the range of 0.7–0.8%. The largest growth was recorded in the health sector (+1.18%), industry (+1.01%) and technology (+0.98%).
According to the US Department of labor, February sales of new housing rose by 4.9%, indicating a possible recovery in economic activity in the real estate market.
Investors are optimistic after the completion of the next round of trade negotiations between the US and China. China has made proposals on key issues, including the forced transfer of technology. This week, representatives of the two countries will continue talks in Washington. Market participants hope for a quick resolution of the trade conflict, which supports the continued growth in the world markets.
Asian sites are closed in the black. Shanghai CSI gained 2.6% after the publication of the March index of business activity in the manufacturing sector of China (PMI), which unexpectedly rose from 49.9 p. to 50.8 p., indicating a resumption of growth in business activity and is regarded by the market as a favorable factor. Nevertheless, it is necessary to take into account the seasonality of factors: activity in March increases significantly after the New Year holidays in February, when the PMI index falls. European market opened in the green zone.
S&P500 futures add more than 0.5%. According to our estimates, today’s auction it will be in the range 2820-2860 points.
From macrostatistics should pay attention to the data on the dynamics of retail sales in February. Their growth rate is expected to accelerate from 0.2% to 0.3%. The focus is also on the index of business activity in the manufacturing sector (PMI) from ISM, which, according to the forecast, will remain at the level of 54.2 p. Recall that the figure above 50 p. indicates an increase in economic activity, so traditionally positively perceived by the market.
Oil is testing the mark of $69 per barrel, as the US sanctions against Iran and Venezuela, along with a reduction in supplies under the OPEC+ agreements offset concerns about the imbalance in the hydrocarbon market. The negotiations between the US and China on mutual trade add optimism to the exchange players. Nevertheless, the continued growth of oil prices may be limited by the General weakness of the world economy.