Here we take a look back at what happened in the market over the last week and look ahead to the major events coming up next week.
Markets across the globe suffered falls this week as inflation concerns continue to dominate sentiment. Growth stocks in particular continue to deteriorate as fears grow over further interest rate hikes. The Fed raised interest rates by 50 base points during the week, which was widely expected.
Following the FOMC meeting there was a brief rally in US stock indices as the Fed indicated it was not pursuing more aggressive 75 point hiles, but that didn’t last long as market gains were given back on Thursday.
European stock indices suffered in particular this week as weak earnings reports reflected ongoing damage from inflation, the war in Ukraine and fresh lockdowns in China. The European Central Bank is expected to raise interest rates later this year in response to rising inflation.
In the UK, the Bank of England raised interest rates by 25 base points to 1% and warned that it expects the UK economy to contract by 0.25% in 2023, rather than grow by 1.25% as in its previous forecast. The pound fell to its lowest level for two years and ended the week at $1.23.
The benchmark indices finished the week as follows:-
- S&P 500: -0.2%
- DOW Jones: -0.2%
- Nasdaq: -1.33%
- FTSE 100: -1.61%
- DAX: -2.30%
- CAC: -3.26%
Tech stocks continued their decline as they have suffered particular damage from decades-high inflation, rising interest rates, higher US Treasury yields and weak earnings reports. The Nasdaq index was down 1.33% on the week.
However, it was a more mixed week for the major tech stocks, with Apple, Facebook and Google all seeing gains this week whilst Amazon and Netflix continued their decline.
- Amazon: -6.23%
- Apple: +0.29%
- Facebook (Meta): +1.29%
- Google (Alphabet): +2.06%
- Netflix: -5.50%
It was a mixed week for commodities, with gold and silver down amid news of interest rate hikes from the Fed, but oil seeing rises as Europe prepares a ban on Russian oil.
- Gold: -0.68%
- Silver: -1.68%
- Brent Crude: +6.73%
- US Crude: +6.22%
It was another brutal week for cryptocurrencies, which have suffered a battering during 2022.
Most of the major cryptocurrencies suffered just short of double-digit losses amidst a gloomy economic picture overshadowing the market.
- Bitcoin: -8.93%
- Ethereum: -7.76%
- Solana: -12.90%
- Ripple: -3.53%
- Cardano: -4.31%
The Week Ahead
Major earnings reports for next week include Walt Disney, Peloton, Upstart, SoFi, BioNTech and Palantir.
Stay tuned for the latest news on all developments in the markets.