Markets round-up: Economic updates investors are watching this week

The week ahead spotlights crucial economic indicators on both sides of the Atlantic. In the EU, attention will be on inflation data, while, in the US, the focus shifts to job figures. These key metrics will provide insights into economic health, shaping market sentiment.


European stock markets extended their winning streak in March, marking the fifth consecutive month of gains and capping off a remarkable first quarter in 2024. 

EU inflation and US Job Data in focus

The Euro Stoxx 50 and the DAX maintained their momentum, reaching new record highs as investors anticipated potential rate cuts by the European Central Bank (ECB). The US stock markets have also wrapped up the month on a positive note as the surge in interest surrounding artificial intelligence (AI) contributed to the positive market sentiment. 

However, there is a debate emerging regarding whether the stock markets can sustain their bullish run, as concerns over profit-taking and potential tech exhaustion may lead to market corrections.

This week, investors’ attention will be squarely on two key economic indicators: the inflation reading for the European Union and job data in the US. These metrics hold significant importance as they serve as crucial gauges for central banks in determining their monetary policies. Additionally, major economies such as the EU, the UK, and the US are set to release their final manufacturing and services Purchasing Managers’ Index (PMI) data, providing further insights into the health of their respective economies.

Most major stock exchanges, including those in Europe, Australia, and New Zealand, remain closed, while the US market resumes trading on Monday.

The EU

The Eurozone is poised to release its Consumer Price Index (CPI) for March this week, which is considered a pivotal economic indicator influencing the European Central Bank’s (ECB) rate decision. The ECB finds itself at a critical juncture in reassessing its monetary stance, given the stagnation experienced by the regional economy throughout 2023. 

In February, headline inflation dropped to 2.6% year-on-year, marking the lowest level in the past three months. The primary contributor to this easing of consumer price growth was a decline in energy prices. Core inflation, which excludes food and energy, rose by 3.1%, also representing the slowest increase since March 2022. The forthcoming data is anticipated to be influenced by the rebound in energy prices during the first quarter. This may lead to a delay in the ECB’s decision to initiate a rate cut, potentially capping gains in the stock market.

Furthermore, the major economies within the region, such as Germany, Spain, Italy, and France, are scheduled to release their final manufacturing PMI data for March this week. While initial estimates indicated that manufacturing PMIs for all these countries remained in contraction territory, there are expectations for stability in the expansion pace of services PMIs for Spain and Italy.

Germany exhibited the weakest growth among these economies, with expectations of a second consecutive quarter of contraction in Q1 of 2024. According to initial data, Germany’s manufacturing PMI…

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