This week, investors focused on the following.
Earlier this week, the US Attorney General, William Barr announced that he would release a redacted version of Mueller Report on Thursday. Yesterday, he released the 448 report that outlined the actions of Donald Trump’s campaign and whether he obstructed justice. The report found that the president and members of his campaign did not knowingly collude with the Russians. In the second case, Robert Mueller and his team did not conclude that Trump did obstruct justice. This report ends a two-year process that has consumed the Trump’s presidency. However, the stock market did not have a major reaction to the report because a summary was released a few weeks ago.
This week, the earnings season continued with relatively impressive numbers. The major banks that released their earnings were Goldman Sachs, Bank of America, and Morgan Stanley. While their results were good, the challenge was in the Fixed Income, Currencies, and Commodities (FICC) segment. For all large banks with the FICC segment, the earnings were relatively weaker because of the lack of volatility in the quarter. Other major companies that released this week were Johnson & Johnson, Netflix, IBM, and United Continental among others.
Initial Public Offerings (IPOs)
This week, investors also focused on the IPO market. This is because a number of unicorn IPOs launched their IPOs within the week. Yesterday, Pinterest, the social media platform gained by more than 25% on its first day of trading. The other major company was Zoom, which saw its stock price gain by more than 80%. This optimism is a good thing for the IPO market as Uber and Palantir prepare to launch theirs. In the next few weeks, traders will focus on Pinterest and Zoom and see whether they will continue the Lyft’s weak performance.
After months of speculation, investors received the economic data from China that they needed. On Wednesday, the country released the first quarter’s economic growth data. The number showed that the economy grew by 6.4%, which was higher than the 6.3% that traders were expecting. It was unchanged from the previous quarter. In addition, the country’s unemployment rate, retail sales, and industrial production number was better than expected. This led to a sharp gain in the Australian dollar. The chart below shows the performance of the Aussie and the yuan.