Weekly Market Roundup

Weekly Market News – 16/05/2022

Stock markets had another rough week with some very choppy moves on concerns over monetary tightening to combat high inflation and a possible recession. A decent bounce on Friday repaired some of the damage, but share markets still finished down for the week, with government bond markets being one of the few places to hide. There’s a lot to focus on this week on both the economic and corporate front and we’d expect the trajectory of the Pound to remain in focus ahead of some key data points for the UK economy.

Last Week

• Stock markets had another tough week; US and big technology shares weighed. Recent declines have now taken the P/E of the US share market below its 5 and 10 year averages.
• The Pound continued its decline vs the US Dollar – now down over 9% for the year.
• Bond markets improved as yields fell, although credit struggled.
• Gold gave up ground, with mining shares bearing the brunt of losses.
• Economic data was fairly bleak, with continued evidence of persistent inflation and weak growth in the UK and China.

Things to look out for this week

• There’s a fair amount of UK economic data this week, so we’d expect the Pound to be in focus. Tomorrow sees the release of employment data, Wednesday sees inflation numbers (with CPI expected to rise to 9.1%) and Friday sees the release of Retail Sales data.
• Retail Sales data is also released in the US tomorrow which will be a key data point given the miss last week on some of the big consumer confidence surveys.
• There’s also a fair amount on the corporate calendar. Tuesday sees results from Imperial Brands, Vodafone, Home Depot and Walmart. Wednesday sees results from British Land, Target and Cisco and Thursday sees results from Investec, Royal Mail and EasyJet.