Learn To Trade
 
Indicators & Chart Patterns

Deepen your knowledge of technical analysis indicators and hone your skills as a trader.

Find your detailed guides here
Trading Glossary

From beginners to experts, all traders need to know a wide range of technical terms. Let us be your guide.

Learn More
Knowledge Base

No matter your experience level, download our free trading guides and develop your skills.

Learn More
Learn To Trade

Trade smarter: boost your skills with our training resources.

Create a live account
Market Analysis
 
Market News

All the latest market news, with regular insights and analysis from our in-house experts

Learn More
Economic Calendar

Make sure you are ahead of every market move with our constantly updated economic calendar.

Learn More
Technical Analysis

Harness past market data to forecast price direction and anticipate market moves.

Learn More
Live Webinars

Boost your knowledge with our live, interactive webinars delivered by industry experts.

Register now
Market Analysis

Harness the market intelligence you need to build your trading strategies.

Create a live account
Partnership
 
Affiliate Programme

Grow your business and get rewarded. Find out more about our Affiliate Programme today.

Learn More
Money Manager

Increase your income and get compensated for your trading knowledge with ThinkInvest, putting you in control.

Learn More
API Trading

Create your own trading platform or data tools with our cutting-edge APIs.

Learn More
Introducing Broker

ThinkMarkets ensures high levels of client satisfaction with high client retention and conversion rates.

Learn More
White Label

We supply everything you need to create your own brand in the Forex industry.

Learn More
Regional Representatives

Partner with ThinkMarkets today to access full consulting services, promotional materials and your own budgets.

Learn More
Partnership

Plug into the next-gen platforms and the trades your clients want.

Create a live account
About ThinkMarkets
 
About Us

Find out more about ThinkMarkets, an established, multi-award winning global broker you can trust.

Learn More
Security of Funds

Security of your funds is our number one priority. Find out more about our insurance policy with Lloyd's of London.

Learn More
Trading Infrastructure

When it comes to the speed we execute your trades, no expense is spared. Find out more.

Learn More
ThinkMarkets News

Keep up to date with our latest company news and announcements.

Learn More
Contact Us

Our multilingual support team is here for you 24/7.

Learn More
About ThinkMarkets

Global presence, local expertise - find out what sets us apart.

Create a live account
Create account

Week Ahead: May 3, 2021

Fawad Razaqzada Fawad Razaqzada 30/04/2021
Week Ahead: May 3, 2021 Week Ahead: May 3, 2021
Week Ahead: May 3, 2021 Fawad Razaqzada
 
  • RBA and BOE rate decisions
  • Plenty of data, including US nonfarm payrolls
  • Earnings focus turns to Europe
The first month of the second quarter is about to end and it has been yet another solid one for stocks and other risk assets. Central banks such as the Fed and ECB promised to keep their QE stimulus programmes running at full throttle despite signs of strong recovery in the US and some other parts of the world. The speeding up of Covid vaccinations in the Eurozone also helped to calm investor nerves, leading to a turnaround for the euro. The US quarterly reporting season has been very good, too, with 87% of just over half of the S&P 500 companies who have reported their have beaten expectations.

However, on the last day of April, when this report was written, we saw a bit of reversal as month-end portfolio rebalancing and profit-taking took some shine off the indices and caused the dollar to bounce back sharply as the Fed’s Kaplan said the Fed should start talking about tapering bond buying soon – contrary to what Chairman Powell had said earlier in the week. Will the dollar recovery continue in the week ahead of will it once again fade?
 
Looking Ahead

Heading into the new month, will it be a case of “sell in May and go away,” or will we continue to see strength for the markets as confidence grows further about the global economic recovery? Are investors going to start fretting about rising bond yields and the potential for monetary tightening? So far this hasn’t been the case despite growing inflationary pressures, but it is something definitely worth keeping an eye on. Investors have so far taken confidence from strengthening economic data and the Federal Reserve’s dovish resolve emboldened them to stay bullish on stocks despite concerns about high valuations, rising inflation and the potential for borrowing costs to rise.  
 
Investors will now be watching US bond yields closely as they, along with their European counterparts, are edging ever higher amid growing signs about a US-led global economic recovery. As global lockdown measures are slowly likely to ease, things will hopefully return to more normal ways in the coming months. The US economy is likely to maintain or accelerate its strong pace of recovery and inflation will probably heat up. Investors are pricing this in by pushing bond yields higher. Small and steady rise in yields will not scare the stock market bulls, but if they start to accelerate to the upside then it would suggest to me that growth optimism is slowly but surely being replaced by worries over inflation.
 
 
Macro and earnings highlights

We have couple of central bank meetings, featuring the RBA and BoE, while there’s plenty of macro data including monthly jobs reports from both North American nations to look forward. Earnings will continue to pour in from the US in what has been a solid reporting season so far.

Monday
  • German retail sales
  • Euro zone final manufacturing PMIs, flash for Switzerland, Italy and Spain
  • US ISM manufacturing PMI
Although the week ahead is filled with more macro data and central bank meetings, as well as company earnings, the fact that China and Japan will be out until and including Wednesday for public holidays, means expect thinner volumes in the early parts of the week – especially as Monday is also a bank holiday in the UK. Still, the ISM PMI will be important for data watchers as it will provide indications about the health of the US economy, including employment ahead of Friday’s nonfarm payrolls report.

Tuesday
  • Reserve Bank of Australia
  • Earnings: Pfizer
The Reserve Bank of Australia is likely to keep policy unchanged. Domestically, there has been some delays in the vaccination progress in the country, which reduces the chances for a rate hike. But it will be interesting to see what the central bank will say about the surging commodity prices, which should be inflationary. Copper prices have risen about 25% on the year so far, adding to its large gains made in 2020. Iron ore and palladium are also up sharply, with the latter hitting repeated new record highs.
 
Wednesday
  • New Zealand employment data
  • Euro zone final services PMIs, flash for Italy and Spain
  • US ADP private payrolls and ISM services PMI
  • Earnings: Pfizer and GM
We will get more indicators for nonfarm payrolls report on Wednesday as ADP and employment component of the ISM Services PMI are released.

Thursday
  • German factory orders and Eurozone retail sales
  • Bank of England policy decision
  • Earnings: Societe Generale, ING, Next, Barratt,
The focus will be on the Bank of England on Thursday as investors will be wondering whether the central bank will start turning more hawkish amid improvement in data and ongoing optimism over the re-opening of the economy. Flash manufacturing and services PMIs have both climbed above 60.0, retail sales have jumped 5.4% in March and house prices are going through the roof ahead of the stamp duty holiday expiry at the end of June. House prices rose +2.1% month-over-month according to Nationwide. This is yet another sign of rising inflationary pressures in the economy. Although CPI and wage inflation have remained relatively soft, input costs are nonetheless rising as the increases in prices of raw materials are exacerbated by a strengthening pound. In short, there is less need for emergency stimulus measures from the Bank of England and if the central bank does turn hawkish then the GBP/USD may finally break that key 1.40 hurdle where it has repeatedly found resistance.
 
Friday
  • Chinese trade balance Caixin services PMI
  • German industrial production
  • US nonfarm payrolls
  • Canadian employment report
  • Earnings: Credit Agricole and IAG
US nonfarm payrolls report will be the main macro event for the day and investors will be keen to find out whether the jobs market continued to rebound strongly in April after a solid 916,000 increase in jobs in March. Economists are predicting a 950K increase this time, which means there is scope for disappointment if expectations are not met.
Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice. ThinkMarkets will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.

Learn more to earn more

our Education center

Related articles:

Week Ahead: May 10, 2021

By Fawad Razaqzada

10/05/2021

NFP Preview

By Fawad Razaqzada

07/05/2021

Markets bounce back after tech rout

By Fawad Razaqzada

05/05/2021

Market update: Stocks mixed, dollar rebounds ...

By Fawad Razaqzada

04/05/2021

Growth optimism lifts yields, equities and co...

By Fawad Razaqzada

29/04/2021

Meet our contributors
Fawad Razaqzada
×
Fawad Razaqzada
Market Analyst, London

Fawad is an experienced analyst and economist having been involved in the financial markets since 2010, producing market commentary and research for a number of global FX, CFD and Spread Betting brokerage firms. He leverages years of market knowledge to provide retail and professional traders worldwide with succinct fundamental & technical analysis. Fawad also offers trading education to help shorten the learning curves of developing traders.
 
His colleagues consider him an expert at reading price action on the charts. This together with his deep understanding of economics and fundamental analysis, and trading experience, puts him in a great position to forecast short term price movements. Fawad covers a wide range of markets, including FX, commodities, stock indices and cryptocurrencies and his comments are regularly quoted by the leading financial publications such as Reuters and Market Watch. In addition to ThinkMarkets, Fawad also provides analysis and premium trade signals on his own website at TradingCandles.com.
 
 

Carl Capolingua
×
Carl Capolingua
Market Analyst, Melbourne

Carl has over 20 years' experience in financial markets and has held senior analyst roles at a number of financial institutions. Specialising in Australian and US stock markets in particular, Carl uses a top-down approach to assess the global macro picture before using both technical and fundamental techniques to select stocks. He regularly appears as an expert commentator on a number of media outlets throughout the Asia-Pacific region.
 
 
 

Kearabilwe
×
Kearabilwe Nonyana
Market Analyst, South Africa

Kearabilwe is an experienced Sales trader and Analyst specialising in Equity and Equity derivatives. His career in the financial markets has seen him hold various positions in global investment banks and global CFD and Spread betting firms. He has deep interest in using quantitative methods to help him understand and teach the fundamental drivers of asset prices.
 
 
 

Fawad Razaqzada
Fawad Razaqzada
Fawad is an experienced analyst and economist having been involved in the financial markets since 2010, producing market commentary and research for a number of global FX, CFD and Spread Betting brokerage firms.
Carl Capolingua
Carl Capolingua
Carl has over 20 years' experience in financial markets and has held senior analyst roles at a number of financial institutions.
Kearabilwe
Kearabilwe Nonyana
Kearabilwe is an experienced Sales trader and Analyst specialising in Equity and Equity derivatives.

Feel confident?

Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice. ThinkMarkets will not accept liability for any loss or damage including, without limitation, to any loss of profit which may arise directly or indirectly from use of or reliance on such information.
Back to top