The past trading week has been a difficult one for markets and traders across markets with the main indices suffering large drops over the week. The German DAX lost 3.9%, the U.K. FTSE 100 lost 2.0% and the French CAC 40 was down 2.7% and the pan European Stoxx 600 index was down 3.1%. The global slump started with the technology shares which spread into U.S. equities as concerns grew that valuations were becoming stretched as earning season approached. In the U.S. S&P 500 dropped 2.6% for the week erasing its gain on the current year. The Nasdaq Composite dropped 3.1% and the Dow Jones dropped 2.4% on the week. During the week the Federal Reserve eased concerns around the timing of any rise in interest rates which provided a small rest bite in the market for a few days only for the selling to resume amid signs of weaker earnings.
In the coming week there is a raft of economic data to be release from around the globe which have the potential to influence local and global markets and in this time of extra volatility in global markets there are bound to be some surprises to keep investors and traders on their toes. The week starts with Retail Sales in the U.S. for March where expectations are for a continued improvement with a gain of 0.8% forecast.
Tuesday brings inflation data in the U.K., in February inflation fell to a four year low of 1.7%, inflation is expected to ease slightly again to 1.6% on an annual basis which would be the sixth consecutive monthly decrease. In Europe the important German ZEW economic sentiment index is due, the index has been easier for the last three months with the latest in March coming in at 46.6 over 6 points below estimates, for April the index is expected to decrease again to 46.3. U.S. inflation data due out is expected to show an increase of 0.1% month over month and 1.5% on an annual basis. The Federal Chair Janet Yellon is due to speak and there could be comments out on tapering which could cause some excitement in the market.
Wednesday brings a potential market mover in the form of the Chinese GDP number, there has been talk that if the Chinese growth situation continues to weaken the Chinese Government would step in to stimulate growth, growth is expected to have slowed again from the 7.7% recorded in Q4 2013 and 7.3% is expected. In the U.K. unemployment data is due with the number of people claiming unemployment expected to decline by just over 30,000 with the unemployment rate expected to remain at 7.2%. In Canada the interest rate is expected to remain the same at 1.00%.
Thursday in the U.S. sees unemployment claims released, last week the number dropped to its lowest level in 5 months at 300,000 a drop of 32,000, the number is expected to increase this week to 316,000. The Philadelphia manufacturing index is expected to improve again to 9.6 points following a jump to 9 points in March from -6.3 in February.