Markets remained highly volatile in the last week as the conflict in the Middle East raged on, and investors started to price in prolonged disruption to oil flow. Updates over the weekend that the Houthis have started to hit Israel with missiles and US marines have arrived in the region may lead to some gapping again on the Monday open.
Once again, geopolitical updates are expected to dominate the market this week; however, there are some major data releases due out of the US, including the big employment numbers, as well as anticipated liquidity thinning as markets move into the Easter weekend, and so traders are expecting another lively week ahead.
Here is our usual day-by-day breakdown of the major risk events this week:
It’s a quiet calendar day to start the trading week on Monday; however, traders are expecting more volatility across all three sessions as the market reacts to updates from the Middle East over the weekend. The European session does see the release of the German CPI data, which will give Euro traders an indication of the inflationary impact that we may see from the war, and we hear from Fed Ch
The Asian session will see a focus on Japanese markets, with the Tokyo CPI numbers due out early in the day. We have more inflation numbers in the London session on Tuesday, with the Eurozone CPI data due out, while it is a busier calendar day in the New York session. Canadian GDP data will see an early focus on Canadian markets before attention moves south of the border for the US JOLTS Job Openings numbers and CB Consumer Confidence data.
It’s a quiet calendar day for the first two trading sessions on Wednesday; however, US data will be a major focus once New York enters the fray. ADP Non-Farms data is due out early in the session, followed swiftly by US Retail Sales numbers, and then later in the session we have the latest ISM Manufacturing updates.
There is nothing on the calendar of note in the Asian session on Thursday; however, Swiss markets will come into focus early in the European day with key CPI data due out. The usual Weekly Unemployment Claims data is due early in the New York session, but other than that there is little to distract traders from focus on the Middle East.
Good Friday has huge potential for some big moves, with several major centres closed for the Easter holidays. On top of geopolitical updates out of the Gulf, we also have the small matter of key Non-Farms Payroll data out early in the US session, which could really set the market moving if it misses expectations.
