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Analytics, 25 March 2024

What will drive the markets this week?

The S&P 500 closed with little change on Friday, yet marked its most significant weekly percentage increase of 2024, driven by the Federal Reserve’s decision to maintain projections for three interest rate cuts by the year’s end. The Nasdaq finished slightly higher for the day, alongside a rise in the semiconductor index (.SOX), bolstered by ongoing optimism surrounding artificial intelligence. The Dow saw a decline in its daily performance. For the week, the S&P 500 surged by 2.3%, marking its most substantial weekly gain since mid-December. Similarly, the Dow experienced a 2% climb, its largest weekly increase since mid-December, while the Nasdaq enjoyed a 2.9% rise, its most significant weekly jump since mid-January.

In Europe, stock markets paused near record highs on Friday. British, German, and Italian stocks notably outperformed regional peers, buoyed by dovish signals from major central banks throughout the week. Although the pan-European STOXX 600 index closed flat, it extended its streak of weekly gains to nine, reaching another intraday all-time high.

In Asia, Japan’s Nikkei 225 briefly surpassed 41,000 to reach a new all-time high on Friday amid accelerated inflation in February. However, other Asia-Pacific markets experienced declines. Japan’s headline inflation rate for February rose to 2.8%, up from 2.2% in the previous month. Core inflation, excluding fresh food prices, also reached 2.8%, compared to 2% in the previous month.

This trading week will be shortened due to Good Friday. During it, market observers can expect fresh inflation figures, updates on consumer sentiment, housing market statistics, and several notable earnings releases.

Despite the closure of markets for Good Friday, investors will eagerly await the end-of-week unveiling of the Personal Consumption Expenditures (PCE) index. This release will provide crucial insights into whether inflation has resumed its downward trajectory, a pivotal consideration for the Federal Reserve as it contemplates adjustments to its benchmark interest rate.

On Tuesday, attention will be on meme stock GameStop (GME) as it announces its earnings. Additionally, Walgreens Boots Alliance (WBA), Cintas (CTAS), Carnival (CCL), and Jefferies Financial Group (JEF) are among the companies scheduled to report earnings this week.

Events expected to move the markets this week

Monday, March 25

Tuesday, March 26

Wednesday, March 27

Thursday, March 28

Friday, March 29

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