Weekly Market Outlook: ECB, BOC and more US earnings in focus

April 19, 2021 11:30

As we move further into US earnings all eyes will be on the surging stock markets all around the world. Both US and European stock indices have been leading the race higher to record new all-time high price levels as investors focus on the positive economic impact from the coronavirus vaccine rollout. 

Some of the companies reporting this week include Coca Cola, Netflix, ASML, Intel and others. However, there will also be a strong focus on the outcome of this week’s Bank of Canada Rate Statement and Press Conference on Wednesday, as well as the European Central Bank Monetary Policy Statement and Press Conference on Thursday. 

You can learn more about some of the global themes affecting the markets in this selection of education articles:

Weekly Forex Calendar

Source: MetaTrader 5 trading platform provided by Admirals

 

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Trader’s Radar - ECB & European PMIs

It’s a big week ahead for the euro this week with the following economic data and central bank updates due:

  • Thursday 22 April 12.45 pm BST - Monetary Policy Statement
  • Thursday 22 April 1.30 pm BST - ECB Press Conference
  • Friday 23 April 8.15 am BST - French Services PMI
  • Friday 23 April 8.30 am BST - German Manufacturing & Services PMI

The euro has been one of the better-performing currencies in recent weeks with EURUSD, EURCAD and EURGBP notable performers. However, gains were capped towards the end of last week - with profit-taking on some euro cross-rates - as traders now focus on Thursday’s ECB Press Conference. 

More positive news on EU vaccinations have helped but the gains could also have been profit-taking at the beginning of the second quarter on euro currency pairs which have been trending down for the last quarter. 

Source: Admirals MetaTrader 5 Web, EURUSD, Weekly - Data range: from Nov 2, 2014, to Apr 18, 2021. Performed on Apr 18, 2021, at 7:00 pm GMT. Please note: Past performance is not a reliable indicator of future results. 

 

It’s unlikely the ECB will make any changes to its last decision in March but how they express the economic developments in the Eurozone will be widely watched. The European PMI data on Friday is likely to cause more activity as the numbers can confirm the economic recovery or show it is slowing down. 

Either way, EURUSD is at an interesting crossroad as it hovers just below the 1.2000 price level. Historically, the 1.1985 price level has been of interest with key turning points to the upside and downside in March and February. 

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Corporate Trading Updates and Stock Indices

Earnings season continues this week with more companies reporting their latest quarterly earnings results. So far, banks have mostly exceeded analyst expectations but much of this was already priced in beforehand as investors focused on the potential for the Fed to increase interest rates sooner rather than later. 

Some of the companies reporting this week include:

  • Monday 19 April - Coca-Cola, IBM
  • Tuesday 20 April - Procter & Gamble, Johnson & Johnson, Delta Air Lines, Netflix
  • Wednesday 21 April - ASML, Akzo Nobel, Verizon, Intel

Source: Admiral Markets MetaTrader 5, SP500, Daily - Data range: from Aug 21, 2020, to Apr 18, 2021, performed on Apr 18, 2021, at 6:30 pm GMT. Please note: Past performance is not a reliable indicator of future results. 

 

Past five-year performance of the S&P 500: 2020 = +16.17%, 2019 = +29.09%, 2018 = -5.96%, 2017 = +19.08%, 2016 = +8.80%, 2015 = -0.82%.

The S&P 500 stock market index continues to trade above its 50-period (red) exponential moving average as seen in the chart above. While the price has bounced higher several times from this moving average, it is currently more overextended than it has been before.

Traders may look towards the lower timeframes to see the price action in more detail, as well as different technical trading indicators for overbought and oversold conditions, as well as for turning points in the market.  

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