Market Action

• A surprising and sterling jobs number on Friday did not enthuse U.S. equities as a near 300-point fall in the Dow closed out the week. Utilities led the selloff on Friday, moving in tandem with bond yields, which also saw their highest point in 2015.
• European markets continued their upward moves this week. Mario Draghi’s press conference on Thursday revealed higher growth estimates for the Eurozone and rhetoric stating that the ECB’s measures to date have been a success.
• The dollar remains in an upward trend so far in 2015. The Euro hit its lowest point against the greenback since 2003. The currencies of emerging market countries are being hit the hardest, Turkey and Brazil being the most notable.
• Brazil’s credit markets are also seeing extreme pressure. The yield curve inverted this week as inflation and scandals in the corporate and public sectors destroy consumer confidence. S&P announced the deployment of a team of inspectors to investigate the country’s credit rating.
• China formally announced a lower growth target of 7% this week amid a meeting of the country’s parliament. An emphasis on creating a more well rounded economy was a theme of the Prime Minister’s address who also stated that while he was concerned about credit dependency the monetary authorities would step in to support the economy when needed.
• Increasing attention in the oil sector is being devoted to storage capacity. Inventories are at an 80-year high and market analysts are concerned storage will soon be full. Supplies continue to grow even as the number of rigs in operation continues to fall.
• India announced a surprise cut in interest rates this week. Lower energy prices are helping keep inflation down, affording the central bank to loosen monetary policy.
• All 31 banks tested by the Federal Reserve passed this year’s stress tests. The central bank will release their review of bank capital plans next week.

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