Tech Stocks Retreat With Megacap Earnings in Focus

US technology stocks fell as investors turned their attention to a batch of earnings from industry heavyweights that have helped drive the market to all-time highs. The S&P 500 declined by 0.02% to 4,186.72 while Dow Jones was up 3.36 points (0.01%) to 33,984.93.

Consumer Confidence in US Climbed in April to Pandemic High

US consumer confidence climbed sharply in April for a second month, reaching a pandemic high, as Americans grew more upbeat about the economy and job market. The Conference Board’s index increased to 121.7, the highest since February last year, from a revised 109 reading in March. In the past two months, the reading has increased 31.3 points, the most in records back to 1967.

US Home Prices Surge Most Since 2006 With Tight Inventory

US home prices soared the most in 15 years, with low mortgage rates and a scant inventory of properties to buy fueling a tight housing market. Nationally, the S&P CoreLogic Case-Shiller index of property values climbed 12% in February from a year earlier, the biggest jump since 2006. That followed an 11.2% gain in January. Home prices in 20 US cities jumped 11.9%.

France, Germany Support US 21% Tax Plan for Corporations

France and Germany have given their backing to the US proposal for a 21% minimum tax on multinational companies, adding momentum to efforts to overhaul global rules. The plan by President Joe Biden’s administration earlier this month transformed global negotiations after years of being bogged down. It also carries a significantly higher levy on companies than the 12.5% minimum tax previously discussed.

Germany Lifts Gdp Forecast, Expects Consumer Spending Surge

The German government raised its growth forecast for this year to 3.5% and expressed confidence that consumer spending will take off once the pandemic is under control and there is room to ease lockdown restrictions. Manufacturing and exports will also be important drivers of the revival after last year’s contraction of around 5%. The German government expects expansion to accelerate slightly next year to 3.6%.

Kuroda to Miss Price Goal as Japan’s Inflation Hunt Drags on

BOJ Governor Haruhiko Kuroda will fail to reach his goal of stable 2% price growth during his term after what will have been more than a decade of stimulus to stoke inflation. Even with an economy expected to show a faster recovery from the pandemic, a slew of rising commodity costs and global expectations for accelerating inflation, the BOJ still couldn’t find enough positive factors to see price growth averaging 2% by the end of March 2024.

Korean Economy Joins China in Surpassing Pre-pandemic Peak

South Korea led the developed world to join China in exceeding the size of its prepandemic economy, as investment and exports helped it expand faster than expected. Gross domestic product grew 1.6% during January-March from the previous quarter. That pushed GDP above the level at the end of 2019, before the coronavirus hammered activity.

Oil Rises With Demand Optimism Offsetting Virus Concerns

Oil climbed by the most in nearly two weeks with the OPEC+ alliance and BP Plc pointing to signs of a robust demand recovery taking shape in parts of the world. Brent crude for June settlement rose US$0.77 to US$66.42 per barrel.

Source: Affin Hwang Research - 28 Apr 2021