What Went Down in the Markets Last Week?
U.S. Stock & Bond Roller‑Coaster
The big three markets—the Dow, the S&P 500, and the Nasdaq—all took a dip. Investors were putting the brakes on after a hiccup in inflation numbers and a flare‑up of tension in the Middle East.
- Inflation kicked back: The CPI for March rose 0.36%, same as February, spoiling the “cooler‑than‑expected” hopes.
- Medical and transport costs: Those two are the main culprits, nudging year‑over‑year inflation to 3.5%—the highest since September.
- Supercore inflation: When stripping out wild cards like energy and housing, the rate shot up 4.8% — a sign the core price pressure is still on fire.
- Yield moves: Long‑term Treasury yields saw a bump, as investors play it safe.
Because of that, futures traded away a shot at an early Fed rate cut. So while growth stocks still led the pack, the value‑side—especially real estate and utilities—felt the sting of those higher rates.
Europe’s Unsteady Dance
The STOXX Europe 600 slipped, with Germany’s DAX and France’s CAC 40 also down. On the flip side, the FTSE 100 held firm, thanks to the weakening pound giving UK firms a boost on global sales.
Bond markets were jittery after the U.S. inflation data, sending French, German, and Italian yields through the roof—early on. But the ECB kept its main deposit rate steady, hinting that any rate cuts will only come if inflation convincingly settles near the 2% target.
Economic optimism in the Eurozone reached a two‑year high, boosted by steady GDP growth and a revived manufacturing sector, even as geopolitical tensions linger.
Asia’s Mixed Bag
Japan: Nikkei 225 and TOPIX ticked up while the yen slid toward a 34‑year low. The Bank of Japan is staying calm, refusing to hit rates higher just because the currency’s weak.
China: Shanghai Composite and CSI 300 fell. Trade output sprinted downhill, and import growth slowed, casting doubt on domestic demand. Beijing may have to stir the pot with sharper stimulus if it wants to hit its annual growth goals.
Bottom Line
Last week’s moves paint a picture of a world still juggling inflation fears and geopolitical drama. Central banks are walking a tightrope—balancing their own data against shaky global signals—while investors must keep a close eye on the next set of data releases and policy tweaks.
