General Market Analysis – 17/03/25

US Stocks Rally into the Weekend – Nasdaq Up 2.6%

US stocks rallied strongly on Friday as investors shrugged off tariff concerns and looked to buy dips, with tech stocks performing particularly well. The Dow gained 1.65%, while the S&P and Nasdaq notched up their best daily performance since 6th November, gaining 2.13% and 2.61%, respectively. The dollar drifted lower, with the DXY losing 0.11% to move down to 103.72, while Treasury yields pushed higher, the 2-year up 6 basis points to 4.017% and the benchmark 10-year adding 4.4 basis points to move back up to 4.312%.

Oil prices jumped again to close out a volatile week near flat, with Brent adding 1% on the day to close at $70.58 and WTI up 0.95% to $67.80 a barrel. Gold hit another record high before ultimately dropping slightly lower on the day, down 0.32% to $2,978.09.

Central Banks in Action This Week

Traders expect a shift in focus this week, with key interest rate announcements from major central banks due over the next few days. Last week’s price action was undoubtedly influenced by geopolitical developments, as tariff tit-for-tat exchanges led to highly volatile conditions. However, this week should see investor attention return to fundamentals, with the Federal Reserve, the Bank of Japan, the Bank of England, and the Swiss National Bank all set to make rate announcements.

Despite only the SNB likely to make a move this week, traders anticipate significant volatility around these events as their respective committees update the market on future policy moves, particularly in light of recent geopolitical developments and data releases.

Data in Focus to Start the Trading Week

Asian markets are set to open the week on the front foot after a strong day on Wall Street on Friday, but attention will soon turn to key economic data as the day progresses. The initial focus in the Asian session will be on Chinese markets, with the usual monthly data release expected midway through the session. Investors will closely watch the Industrial Production figures (expected at 5.3%) and Retail Sales numbers (3.8%), while the subsequent press conference could also trigger market movements.

There is little on the calendar in the European session, but the first major US data releases of the week are due shortly after the New York open, including Retail Sales (expected +0.6%), Core Retail Sales (+0.3%), and the Empire State Manufacturing Index (-1.9), all released simultaneously.

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