Global equities delivered another positive week, led by strong returns from Emerging Markets and Japan. US equities also advanced, while UK equities lagged, weighed down in part by the decline in oil prices, which fell nearly 10% over the week. Despite the recent pullback, oil remains significantly higher year-to-date, reflecting ongoing geopolitical uncertainty in the Middle East.
In the week ahead, we will continue to monitor geopolitical developments closely, alongside key macroeconomic releases and market data.
Last week
- It was another week of easing oil prices, reflecting growing optimism around efforts to de-escalate tensions in the Middle East.
- Global equity markets generally posted positive returns, although UK equities ended the week slightly lower.
- Japanese equities continue to lead major developed markets year-to-date, with gains of more than 15%.
- It was a relatively quiet week for economic data, with few releases materially shifting market sentiment. One notable exception was US durable goods orders for April, which surprised meaningfully to the upside. Canadian GDP data was slightly weaker than expected, with March growth modestly negative.
- It was also a quieter week for corporate earnings, with most major companies having already reported first-quarter results.
This week
- Oil prices have started the week higher following renewed geopolitical tensions in the Middle East, increasing concerns over potential supply disruptions.
- Closer to home, EasyJet shares rose sharply in early trading following reports that the company may be open to takeover approaches.
- A busy week of macroeconomic data lies ahead, including US manufacturing and services PMI releases, Eurozone inflation figures, and US employment data.
- Several notable companies are due to report earnings this week, including Broadcom, Palo Alto Networks and Ulta Beauty.
| Equities and Oil | Last week (%) | YTD (%) |
|---|---|---|
| WTI Oil | -9.6 | 52.4 |
| Global | 1.7 | 13.5 |
| UK | -0.3 | 6.5 |
| US | 1.3 | 11.1 |
| Japan | 1.5 | 15.3 |
| Europe ex UK | 1.0 | 7.1 |
| Emerging | 1.7 | 10.8 |
| Bonds, Gold and Currencies | Last week (%) | YTD (%) |
|---|---|---|
| Sterling Corporates | 0.7 | 0.3 |
| GBP vs Japanese Yen | 0.4 | 1.4 |
| GBP vs USD | 0.2 | 0.0 |
| UK Government Bonds | 0.7 | -0.5 |
| High Yield | 0.8 | 2.1 |
Source: Bloomberg. Currency GBP.
More details
Market sentiment last week remained supported by expectations of easing geopolitical tensions, which helped improve the outlook for both inflation and interest rates. However, developments over the weekend and into Monday have highlighted that geopolitical risks remain elevated, contributing to renewed strength in oil prices.
Despite the quieter earnings calendar, Costco’s results attracted investor attention. The company reported third-quarter earnings per share of $4.93, slightly below consensus estimates of $4.97, leading to some weakness in the share price. Investors were particularly focused on management’s commentary regarding consumer spending trends, digital sales growth, and the ongoing impact of tariffs and higher energy prices.
Artificial intelligence continues to dominate market headlines. While Nvidia recently delivered another strong set of results, the market response was relatively muted given elevated investor expectations. The company has also announced a new PC chip designed to bring AI capabilities directly to personal computers, further expanding its reach beyond data centres.
The value of investments and the income from them can go down as well as up and you could get back less than you invested. Past performance is not a reliable indicator of future performance.
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