Tech Shares Push Stocks Higher; Crude Oil Falls

Technology shares led US stocks higher, regaining favor on the last day of a quarter where they trailed the rest of the major market sectors, with President Joe Biden set to unveil his next stimulus plan. The S&P 500 rose by 0.36% to 3,972.89 while Dow Jones was down 85.41 points (0.26%) to 32,981.55.

Biden Pitches US$2.25 Trillion Plan to ‘bring Everybody Along’

President Joe Biden presented a US$2.25 trillion US infrastructure plan, setting the stage for a drawn-out battle over his second big economic program after his pandemicrelief package’s relatively smooth sail through Congress. The “American Jobs Plan,” as the president dubbed it, lays out an eight-year program that includes US$620 billion for transportation and US$650 billion for initiatives such as cleaner water.

US Pending Home Sales Fall Most Since April on Low Inventory

US pending home sales fell in February by the most since April as rising home prices and a shortage of available properties deterred buyers. The National Association of Realtors’ index of pending home sales decreased 10.6% from the prior month to 110.3, the lowest reading since May. Surging home prices and low inventory are slowing the pandemic-era housing boom.

Lagarde Says Market Can Test ECB Resolve as Much as It Wants

European Central Bank President Christine Lagarde said policy makers won’t shy away from using all their powers should investors try to push bond yields higher. She noted that they have exceptional circumstances to deal with at the moment and they have exceptional tools to use at the moment, and a battery of those. They will use them as and when needed in order to deliver on their pledge to the economy.

UK Raises Living Wage for Workers After ‘difficult’ Year

The UK raised the national living wage for workers, a boost that Chancellor Rishi Sunak said would help employees as the economy ramps up again. The national living wage, which is the minimum that a company must pay workers 23 years of age and older, rose 2.2% to US$12.30 an hour. It was previously only available to employees over the age of 25.

German Unemployment Resumes Decline Despite Even Longer Curbs

German joblessness declined in March, signaling economic resilience even as thousands of businesses remain affected by recently-extended pandemic restrictions. The drop of 8,000 put the total number of unemployed people at 2.75 million and kept the rate at 6%. The labor market experienced a noticeable spring revival -- despite rising infections and persistent curbs for some sectors of the economy.

Australia’s Central Bank Wins Policy Reprieve, Faces Fiscal Risk

Australia’s central bank welcomes the respite from bond traders and its policy resolve, rewarded with both lower yields and a weaker currency. Now it confronts a fiscal pullback that could complicate its jobs goal. The RBA is set to complete its first A$100 billion of quantitative easing soon after policy meeting and will immediately follow up with another program of the same amount. Governor Philip Lowe is expected to keep the interest rate and yield target at 0.10%.

Oil Slides With Lockdowns Spreading Ahead of OPEC+ Decision

Oil fell the most in roughly a week after France announced it will start a month-long lockdown, while OPEC+ voiced its concerns about the strength of oil demand ahead of an expected decision this week on output. Brent crude for May settlement slipped US$0.60 to US$63.54 per barrel.

Source: Affin Hwang Research - 1 Apr 2021