3 April 2023

Awaiting labour market data, eyes on inflation

While waiting for the labour market data in the US, the markets focused on the signals coming from inflation, confirming their expectations of an end to monetary tightening now imminent. In the Eurozone, the situation remains more complex, with the core data continuing to rise. In the US, the core PCE price index surprisingly declined. The PMI surveys confirm that the real economy continues its expansion phase, thanks mainly to the service sector. But for companies, margins are shrinking: in the US, corporate profits fell by more than two percentage points year-on-year in Q4 2022. Let’s take a look at some statistics from our weekly analysis.

In the past week, 83% of the instruments and indices used for our analysis showed a positive change. 17% experienced a negative change. Analysing by macroclass, 97% of the equity instruments and indices recorded a positive weekly change. 26.% of the bond instruments and 72% of the other asset classes used for our analysis.

Improving valuations in the past week accounted for 49% of the total. The previous week, valuations that had been adjusted upwards were 36% of the total.

In our analysis of equities, improving valuations accounted for 53% of the total. In our global analysis, gold remains the leader in the short term, but at one week’s notice the equity sector has recovered.

In our analysis of bonds, improving valuations accounted for 43.75% of the total.

Among analyses of other asset classes, improving valuations accounted for 53 per cent of the total. This section includes both sentiment analyses and analyses relating to currencies and commodities.

Of the valuations, 55 per cent were above average in the short term. 46% were above the long-term average of valuations. Last week it was 44% and 32% respectively.