STATE OF THE MARKETS

All green for good Friday. US stocks closed in the green Thursday, with S&P500 (+1.18%) made a new all time high above 4,000 mark, while Dow (+0.52%) and Nasdaq (+1.76%) climbed higher; led by tech stocks, real estate and energy in a short week for the Easter Sunday. Dollar was sold, and the 10Y benchmark retreated 10 basis points from 1.78% to 1.68% after markets bite that Feds will be dovish for a while.

Crude rebounded higher, above $61.45/bl, after being battered for two days by demands concerns in Europe and South Asia. OPEC+ decision to roll over the production quota for a month or two, while talks of increasing supply by Saudi’s might set a new selling pressure on the black gold. On another note, lower yields and Dollar, sent the yellow metal gold higher, breaking $1,730/oz as of this writing, but remain under short and medium term downtrend.

In the FX space, King Dollar lost its reign in the short and medium term. Renewed optimism on the global economy for the second quarter, sent Kiwi to the helm of demand in the short and medium term, along side Aussie and Sterling. Loonie weakness was observed in the short term as crude downside remains while Euro remains relatively unchanged across the board. Markets confidence is seen elevated as volatility index (VIX) dived below 17.50, the lowest in 14 months, in line with demand for the Swiss and Yen. For now, markets is waiting on NFP figures on Friday.

OUR PICK – No new pick.

No new pick going into weekend. Markets closed Q1 with a bullish tone, albeit on heavy hedging through bonds and precious metal; plus quite some flows to cash as well as cryptos. Risk remain elevated that rising yields will spark more demand for Dollar, though some investors were seen going into higher yielding dividend stocks and corporate bonds on some risk. Demand for small and mid cap growth stocks will dominate the equities markets in the next 4 – 6 weeks, in our view. April is 2/3 of the time in 25 years, is the worst month for USD versus CAD, so if history repeats itself, then we should see more demand for Aussie and Kiwi as well as precious metals.

Trades update: EUR/USD reached medium term TP2, MRO remains active as we expect crude weakness to continues pressing oil stocks lower, USD/CAD sell stop was filled and we have exited early going into NFP, Silver has reached medium term TP1 and a dime to TP2. Kroger remains active as long as daily price closed below $36.80.

To our Christians friends, have a good Friday and Easter Sunday. Have a wonderful weekend.