FTSE 100 Trading forecasts and signals - page 6

Key events of the dayToday, the markets' attention is focused on the preliminary business activity indices (PMI) for April in the eurozone, the United States and the United Kingdom. These data will be the first indicator of the impact of uncertainty related to trade tariffs. In the eurozone, the manufacturing PMI is expected to decline to 48.2 from the previous level of 48.6, due to a drop in new orders from the United States. At the same time, the index in the service sector is likely to remain stable at around 51.0. Despite the fact that the PMI is usually less sensitive to sentiment, the risks of a negative effect still remain.In the United States, a similar dynamic is expected: a decline in industrial activity against the backdrop of gloomy data from the Philadelphia Fed index published last week. The service sector is expected to hold its position unless increased uncertainty begins to put pressure on consumption. However, March retail sales showed resilience, which reduces risks.Economic developments in AsiaIn Japan, the April PMIs showed mixed results. The manufacturing index continued to decline for the tenth month in a row, dropping to 48.5, partly due to concerns about U.S. tariffs. The service sector, on the contrary, grew to 52.2, driven by increased customer demand and the largest increase in sales over the past three months. Pressure on prices has increased: companies are recording the fastest cost growth in two years, leading to higher product prices. The composite index returned to the expansion zone, rising to 51.1 from 48.9 in March.Economic developments in the USAThe index of manufacturing activity of the Federal Reserve Bank of Richmond deteriorated in April to -13 from -4 in March. The shipment component decreased to -17, which, together with data from the Federal Reserve Bank of Philadelphia, signals a clear deterioration in the industrial situation. The effect of pre-accumulation of orders in the first quarter is being replaced by a slowdown due to increasing uncertainty.In the political arena, President Trump has eased pressure on the Fed, saying there are no plans to fire Jerome Powell. This led to a decrease in the probability of his resignation in the markets from 21% to 13%, supporting a positive mood among investors, strengthening the dollar and sending gold into a downward correction. Prior to Trump's statement, U.S. Treasury Secretary Bessant also described the trade war with China as "unsustainable," which gave an additional boost to asset growth. At the same time, Trump expressed cautious optimism about the deal with China, noting that tariffs would eventually be "significantly lower" but not reduced to zero.Events in EuropeIn the eurozone, the consumer confidence index dropped to -16.7 in April, which is the lowest level since November 2023. The decline is mainly due to the effects of the trade war and falling stock markets. So far, this deterioration has not been reflected in real data — retail sales in the United States in March, as well as transaction data in Denmark, remain strong. Thus, the decrease in confidence so far looks more like an emotional reaction to external factors.According to the quarterly survey of the European Central Bank among professional forecasters, inflation expectations have slightly increased, and economic growth forecasts have been slightly revised downwards. However, the changes turned out to be insignificant, indicating moderate expectations of further consequences of the trade war. The next round of forecasts may be less optimistic due to the escalation of tariff conflicts between the United States and China in April.International trade and macroeconomicsTrade disputes remain in the spotlight: The International Monetary Fund has revised down its global economic growth forecast for 2025, noting particularly significant declines for the United States and China. The main threats are the further escalation of trade wars and the tightening of financial conditions.The situation in SwedenAn unexpected improvement was recorded in the Swedish labor market: the unemployment rate fell to 8.1% in March from 8.9% in February. At the same time, employment growth was higher than expected, and the increase in the workforce was in line with forecasts. However, risks of deterioration remain in the event of escalating tariff conflicts and turbulence in the stock markets.Geopolitical newsProgress has been made in relations between Russia and Ukraine. According to media reports, Russia offered to stop the offensive on the current front lines, and Ukraine expressed its readiness for negotiations after the establishment of a ceasefire.The raw materials marketOil prices have strengthened amid the introduction of new US sanctions against Iranian oil exports, as well as due to improved market sentiment following the softening of US rhetoric towards China. A barrel of Brent costs about $68 in the morning.Stock marketsGlobal stock markets showed solid growth, offsetting the drop at the beginning of the week. Cyclical stocks outpaced defensive sectors in growth. Bond yields declined, and the dollar strengthened. Major US indexes closed in positive territory: Dow +2.7%, S&P 500 +2.5%, Nasdaq +2.7% and Russell 2000 +2.7%. The positive mood remains for the morning in Asia, as well as on European and American futures.Debt market and foreign exchange marketThe weakening of Trump's rhetoric towards the Fed chairman and trade negotiations with China contributed to the relief in financial markets. Today's PMI releases will be an important indicator of the current state of the global economy and will play a key role in further decisions by central ...

Escalation of the tariff war: the US and China continue their confrontationFinancial markets are in a state of heightened anxiety as investors closely monitor further actions by US President Donald Trump as part of the ongoing tariff confrontation. At the moment, most countries face a 10% duty on a wide range of exported goods, as well as a 25% tariff on automobiles, steel, aluminum, and products from Canada and Mexico. China, by contrast, is in the worst position, facing a record 145% interest rate.The markets have already partially priced in further escalation, but the current measures from the United States represent an actual tightening of fiscal policy, which increases the likelihood of a recession. On the other hand, China is expected to take stimulating steps, possibly lowering the benchmark interest rate after Easter. At the same time, a devaluation of the yuan is unlikely, since Beijing prefers to maintain the stability of the exchange rate.Eurozone: inflation is losing priority, the focus is on slowing growthOn Wednesday, the publication of the final data on inflation in the eurozone for March is expected. The consensus forecast assumes confirmation of the preliminary values, and the market is likely not to react to the release. Investors' attention has already shifted from the inflationary agenda to economic growth prospects and trade risks.On Thursday, the ECB is expected to cut its key interest rate by 25 basis points to 2.25%. The accompanying statement is likely to repeat the phrase that monetary policy is becoming "less restrictive." The head of the regulator, Christine Lagarde, is likely to focus on the deterioration of the macroeconomic outlook, but there will be no direct hints on the next steps on rates.Current events: signals from the USA and AsiaThe US president has announced new tariffs on semiconductors in the coming week. In parallel, an investigation has been launched into national security issues in the semiconductor sector. At the same time, Trump stated the need for "flexibility" in trade issues. On the other hand, Chinese Leader Xi Jinping began his first foreign trip this year, visiting Vietnam, Malaysia and Cambodia. The visit underscores Beijing's desire to strengthen regional ties and forge a multipolar order.Over the weekend, the United States excluded a number of high—tech goods from retaliatory tariffs - smartphones, chip manufacturing equipment and some computers. This provided short-term relief for the American IT sector. However, as noted by Commerce Secretary Howard Latnick, these goods may still be subject to future tariffs on semiconductors expected before May.Macroeconomic data: alarming signals from the United StatesA preliminary survey of consumer sentiment from the University of Michigan for April revealed a sharp deterioration in indicators. The index fell to 50.8 from 57.0 in March, while expectations and current estimates also declined more than expected. At the same time, inflation expectations for the year ahead rose to 6.7%, which increases concerns about lost price control.Producer prices in March, on the contrary, showed a decrease — the PPI index dropped to 2.7% in annual terms, which turned out to be lower than expected. This indicates that manufacturers did not have time to shift potential tariff costs to the final price in anticipation of new duties.Regional inflation: Swedish stabilityIn Sweden, the final March inflation data coincided with estimates: CPI at 0.5% YoY, CPIF at 2.3% YoY. Food inflation accelerated, while other components, including clothing, transportation, and housing, showed declines. Thus, inflation remains below the Riksbank's target level for the eighth month in a row, which supports the regulator's cautious position.Stock markets: optimism with caveatsUS stock markets ended Friday on a positive note — the S&P 500 index gained 1.8%, playing off the news about the exclusion of IT products from tariffs. Apple shares have become the engine of growth. European markets lagged behind in dynamics, but futures indicate a possible increase at the opening. It is worth noting that since the beginning of the year, European stocks have been outperforming American stocks in terms of profitability.Bond and currency markets: dollar under pressure, U.S. yields risingThe EUR/USD pair briefly dropped below 1.13 on Friday, as the weakening of tariff threats supported the dollar. However, overall confidence in American assets remains in question. The yield gap between the US and Europe has become noticeably wider: the yield on 10-year US bonds rose by 50 bps to 4.5%, while German securities remained virtually unchanged (2.55%). Scandinavian currencies remain vulnerable amid global capital flows and high uncertainty.ResultsMarkets continue to balance between the hope of stabilizing trade relations and the reality of increased global risks. Further steps by the United States on tariffs, China's reaction, and central bank policies will determine market movements in the coming ...

USA: inflation and government bonds in the spotlightThe focus of the American market today is the publication of the March consumer price index (CPI). Inflation is expected to slow down: according to the consensus forecast, the overall indicator will decrease from 2.8% to 2.5% in annual terms, and the core CPI index from 3.1% to 3.0%. Despite the increase in tariffs, which reinforces inflation expectations for the medium term, the Federal Reserve's attention is focused on internal, "organic" price pressures. An additional indicator of current investor sentiment will be the auction for the placement of 30-year US Treasury bonds.Sweden: signs of economic recoveryToday, at 08:00 Central European time, data on GDP, production and consumption for February will be published. Given that there has already been an increase in retail sales and the total number of hours worked, there is a possibility of positive dynamics in other segments of the economy. In addition, a speech by a representative of the Riksbank of the Seimas on monetary policy issues will be held at 09:00.Norway: inflation remains at the center of controversyThe inflation data for March will be key for the Norwegian market. In February, consumer prices unexpectedly jumped, helped by rising prices for groceries, air travel, and catering services. The main question now is whether this is a sustainable trend or a temporary effect. We tend to believe that most of the growth will be irreversible, but at the same time, the monthly inflation rate will begin to slow down. The forecast for the core CPI is 3.3% in annual terms, which, by historical standards, is rather in the lower range, especially after the strong February report.Denmark: inflation and unemploymentThe March consumer price index in Denmark is expected to be published today. According to forecasts, inflation will slow down from 2.0% to 1.7%, which will be facilitated by lower prices for electricity and fuel. There will also be data on the unemployment rate, which may affect short-term expectations for the krona. Additional context can be found in the "Reading the Markets Denmark" analysis from April 9th.China: inflation is stabilizingConsumer inflation in China in March was slightly below expectations, at -0.1% year-on-year and -0.4% month-on-month. Despite this, the indicator improved significantly compared to February (-0.7% YoY), which indicates the first signs of the effectiveness of the incentive measures taken by the authorities.Energy market: correction after sharp growthOil prices fell by about 1% after Donald Trump's announcement about tightening tariff policy towards China. Despite this, the main benchmark oil grades ended the previous session with an increase of 4%, recovering some of the sharp drop at the beginning of the day. Brent futures are currently trading in the range of 64-65 dollars per barrel.Global Trade: a sharp turnaround by the United StatesThe day before, the US administration announced a 90-day suspension of new duties on most countries in order to create conditions for negotiations. However, tariffs on Chinese goods were increased to 125%. Notably, this decision does not apply to Canada and Mexico. In response, China announced a 50% increase in duties on American goods, bringing the total tariff to 84%. Despite the escalation, the market has begun to reconsider the probability of a recession in the United States — now it is estimated at less than 50% compared to almost 70% previously.USA: Fed is concerned about inflation amid economic slowdownThe minutes of the FOMC meeting showed that the regulator is concerned about rising inflation with a slowdown in business activity and the labor market. The participants noted the difficulty of choosing between supporting economic growth and the need to curb price pressures. Later, Fed spokesman Thomas Barkin emphasized the importance of consumer spending as one of the sustainable elements of the economy at the current stage.The Eurozone: a response to US tariffsThe EU Council voted to impose duties of up to 25% on American goods worth a total of 21 billion euros, including soybeans and motorcycles. This was a response to the US tariffs on steel and aluminum. The Commission hopes to conclude a deal with the United States on the mutual zeroing of duties and an increase in purchases of American energy, but the likelihood of this remains uncertain.Stock markets: violent rebound after panicAfter a series of sales, the US market showed impressive growth: the S&P 500 index jumped by 10%, showing the best result since October 2008. Particularly strong growth was recorded in the technology sector: shares of Tesla, Apple and Nvidia increased by 20%. There is also a positive trend in Asian markets: Nikkei gained 8%, Kospi — 6%, and Chinese indices remain in the black by 2%. European futures are also signaling an opening with an increase of about 7%.Currencies and bonds: the market is adapting to new conditionsThe US decision to suspend tariffs has caused a surge of optimism: yields on short-term US bonds have increased, and the 2s10s curve has significantly tightened. The Fed's rate forecast for the end of the year has been revised up by 20 basis points. The dollar index remained stable, while the euro weakened against the dollar. Emerging market currencies gained support, while defensive assets such as the franc and the yen suffered ...

Eurozone: indicators of investor confidence and retail salesIn April, investors in the eurozone focused on the Sentix investor confidence index and retail sales data for February. The Sentix index rose significantly in March, helped by a large-scale stimulus package in Germany. However, after the introduction of new tariffs by US President Donald Trump, investor sentiment may worsen, although this may not be fully reflected in the current data. Retail sales have been showing a decline in recent months, which corresponds to a drop in consumer confidence after a strong recovery in the second half of last year. Despite favorable conditions for increased consumption, such as a stable labor market, rising real wages and low interest rates, geopolitical uncertainty is likely to restrain consumer sentiment.Sweden: public debt and inflationIn Sweden, the Office of Public Debt has published data on the state of central government debt for February. In February, the surplus amounted to SEK 74.0 billion, exceeding the projected SEK 60.9 billion, due to higher tax revenues. citeturn0search10 In March, preliminary data on inflation was below expectations: the CPIF index was 2.3% yoy, and CPIF excluding energy and 3.0%. citeturn0search7 This decrease in inflation may ease the pressure on the Riksbank to further tighten monetary policy.USA: tariff policy and market reactionPresident Trump has confirmed his intention to impose extensive tariffs on imports, despite a significant drop in stock markets and fears of a recession. He described these measures as a necessary "medicine" to correct economic imbalances. In response, China announced the imposition of 34% tariffs on all American goods from April 10 and restrictions on exports of rare earths. citeturn0search8 These events have increased concerns about the global trade war and its potential impact on the global economy.Financial markets: reaction to macroeconomic eventsStock markets around the world have experienced sharp declines amid escalating trade disputes. Futures for the S&P 500 fell by more than 3%, and Asian markets showed the most significant decline since 2008. citeturn0news77 Investors expect the Federal Reserve may cut interest rates in response to growing recession fears. At the same time, oil prices continue to decline, reflecting concerns about a slowdown in global economic growth.In general, the current macroeconomic situation is characterized by increased volatility and uncertainty due to the escalation of trade conflicts and their potential impact on global economic ...