Market Analysis

Looking ahead to the week in European and global markets, European markets are expected to start the week on a steady note, with the European Central Bank (ECB) anticipated to maintain interest rates but possibly provide clues about future rate cuts. Additionally, investors will be closely monitoring the latest U.S. inflation report.

In the U.S., attention will be on the Producer Price Index (PPI) data and the release of the Federal Reserve's March meeting minutes. Meanwhile, the UK GDP data is scheduled for release later in the week. Several Fed speakers, including John Williams, Mary Daly, and Raphael Bostic, are also slated to address investors.

While there is minimal expectation for an ECB rate cut during the April 11 meeting, markets have already priced in rate cuts for June, with the possibility of additional cuts later in the year. Therefore, market focus will be on any statements from ECB officials and the tone of the accompanying statement.

European bourses are anticipated to open steadily, with attention on the STOXX 600 index, which touched a two-week low on Friday. Ahead of the ECB meeting, investors will be digesting the upcoming U.S. Consumer Price Index (CPI) report, expected to show a slowdown in core inflation for March.

The data will be crucial in determining when the Federal Reserve might begin its interest rate cutting cycle, a question that has been on traders' minds. With expectations previously set for March, then pushed to June, and now possibly to July or September due to strong U.S. jobs reports, the inflation report becomes pivotal for market sentiment.

Investors may also be adjusting to the idea that a robust U.S. economy could be positive, despite concerns about elevated U.S. Treasury yields. While higher yields have bolstered the dollar, equities have also shown resilience. However, whether this enthusiasm for risk assets continues in the face of higher U.S. rates remains uncertain.

Furthermore, reports of progress in talks for a truce in the Gaza conflict have contributed to improved risk appetite among investors.

Paraphrasing text from "Yahoo Finance" all rights reserved by the original author.