Trading Day Battles will help you lose confidence
Orlando, FL (Reuters) – Trading date
Understand the power to drive global markets
By Markets columnist Jamie McGeever
As Israel’s strike against Iran caused a sharp rise in oil prices and global stock sales, the week that began with investors in reasonably optimistic mood was placed on bets that the US and China would sign a deal in trade negotiations in London.
Washington and Beijing have reached a “framework” deal, but details are ambiguous and have yet to be ratified, but have helped ease global tariff tensions.
Investor sentiment was also boosted by signs that global inflationary pressures were being cooled. Price inflation rates for consumers and producers in the US, Japan, India and China were all weaker than expected, but the major caveat is that the impact of tariffs is not yet felt appropriate.
The long-term strong demand for the US Treasury at auction this week also eased concerns about the sustainability of US debt. President Donald Trump’s “big, beautiful bill,” budget deficits and federal debt remain on the market, but there was a temporary reprieve this week.
Not for dollars. It has fallen to the weakest levels against a basket of currencies for over three years, failing to extract the demand for “safe shelters” that can be identifiable from the surprising geopolitical risks and tensions in the Middle East.
Non-US investors continue to revalue their exposure to dollar-denominated assets. Those who want to reduce their exposure either sell their assets entirely, buy them, or sell more hedges. Many long-term investors in Europe have increased hedging ratios, which effectively amounts to large dollar sales.
Another big move this week was oil, which spiked nearly 10% at some point on Friday. It cooled a bit, but the high energy priced youkai suddenly returned. If so, what would it do for the outlook for inflation?
Next week we may gain insight into what policymakers will think about it. The G7 Leader Summit in Canada began on Sunday and is the latest policy decision, the Federal Reserve, the Bank of Japan and the Bank of England, among the three most important central banks in the world.
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Key market movements this week
* Oil. Brent crude rose 12% this week, while WTI rose 13.5% on Friday alone, up nearly 10%. It marks its biggest weekly rise since February and October 2022, respectively. *Gold is up 3.5% within $50 in April, at $3,500 per ounce. *The dollar undercuts 1% and closes the week in nearly three years, but the euro rose 1.3%, trading above $1.16 for the first time since 2021. However, Friday’s spikes reduce weekly at the long edge of the curve. *The world stocks and the edges of Wall Street are slightly lower. ThemSci World records Friday sweetness bites at the beginning of the week. The S&P 500 is 0.5% per week, with MSCI Worldshed being 0.3%.