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Weekly Market Wrap 29/04/2022

The major US indexes are on course for their worst month since March 2020 in the face of multiple headwinds such as central bank monetary tightening, persistent inflation, Covid restrictions in China and the ongoing war in Russia.  

Russia is thought to be sustaining significant losses in the “battle of Donbas” as the conflict in Ukraine continues. US President Joe Biden has called on congress to provide Ukraine with military aid worth up to $33 billion in an attempt to support Ukraine’s “fight for freedom”. First quarter earnings for the world’s largest companies have provided mixed results with Meta rallying strongly and Amazon falling sharply post results. Investors look ahead to major economic data as well as central bank interest rate decisions next week which may give much needed guidance on the current global outlook. Chinese regulators are set to temporarily stop the tightening of regulations for the technology companies as Beijing takes a more supportive view of the sector in a time of economic uncertainty for China. 

US Markets 

The S&P 500 ended the week down 0.24% at 4,262 with the tech heavy NASDAQ ending flat at 12,838. US tech stocks provided mixed results as many major companies reported earnings this week. Meta jumped over 17% on Thursday after delivering strong results, including the return of user growth to he Facebook platform. However fellow tech names Amazon and Apple reported downbeat future outlooks driven by rising costs and a fall in demand in the aftermath of Russia’s invasion of Ukraine. US GDP data for Q1 of 2022 showed a fall of 1.4%, well below expectations of a 1.1% gain, increasing investor fears that the Fed may rapidly increase rates to combat persistent high inflation. US consumer spending also rose 0.2% in March.  

UK Market  

There were mixed earnings reports for the UK this week as a number of bank stocks reported positive earnings and outlooks as interest rates look to move even higher in the coming months. UK local elections are set to begin next week, which will provide a key indication of the level of support for both major party leaders. Particularly poor results could spark discussions of leadership challenges on both sides of the House of Commons in an already uncertain time for UK politics.  

European Markets  

The Euro Stoxx 50 ended the week down 0.35% at 3,826, the DAX gained 0.29% to 14,183 whilst the CAC 40 was flat ending the week at 6,583. Strong Q1 earnings reports from a number of European companies helped Europe rebound from lows seen at the start of the week as the outlook for the continent looks concerning on a number of fronts. Declining consumer and business confidence, the continued conflict in Ukraine as well as the ongoing uncertainty regarding supplies of gas and oil from Russia have raised concerns of a potential stagflationary environment and European recession.   

Fixed Income  

Yields on the US 10-Year Treasury have fallen 0.05% to 2.85% as yields remain at elevated levels on the expectation that the Federal  Reserve will continue to raise rates, with a 0.50% hike expected at the Fed meeting next Wednesday. 


Brent Crude gained 3.21% this week, reaching $110 per barrel as the likelihood of a European ban on imports of Russian increases. This week’s gain came despite China’s zero covid policy and its drag on global demand for oil.  

Gold prices fell 1.20% to $1,909 , mainly driven by investor expectations of aggressive interest rate hike as both the BoE and Federal Reserve announce interest rate decisions next week.  


The Week Ahead  

Monday – Early May Bank Holiday 

Tuesday – RBA Interest Rate Decision 

Wednesday – EU Retail Sales, Fed Rate Decision + US Employment 

Thursday – BoE Interest Rate Decision, US Initial Jobless Claims 

Friday – US Nonfarm Payrolls

*Price changes as of last week’s close unless stated otherwise.