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On April 20th, Mitsubishi UFJ Bank stated that current political uncertainty in the UK could lead to further depreciation of the pound. British Prime Minister Keir Starmer faces calls for resignation following the approval of former British Ambassador to the US, Peter Mandelson, despite failing the vetting process. Starmer is expected to address Parliament at 14:30 GMT. These developments have reignited speculation about a potential leadership change should the ruling Labour Party perform poorly in the May local elections. So far, the negative impact on the pound has been relatively limited, but political developments in the UK could trigger a more significant sell-off in the coming month.Romanian President: We may be entering a period of political turmoil. Nevertheless, the ruling party has reached an agreement on budget targets and EU funding.April 20th - According to five sources familiar with the Bank of Japans (BOJ) thinking, the BOJ is unlikely to raise interest rates next week. The dwindling hope for a swift end to the Middle East conflict has left Japans economic and price outlook uncertain. While the final decision remains somewhat uncertain and depends on the progress of peace talks between the US and Iran, the sources said the central bank prefers to maintain the status quo this month to allow more time to assess the impact of the conflict. One source stated, "Given the current level of uncertainty, the BOJ might consider maintaining the status quo this month feasible." Another source echoed this sentiment. A third source said the BOJ is unlikely to raise rates, as the market has already fully priced in the possibility of no rate hike this month. These sources added that even if the BOJ keeps rates unchanged next week, given escalating inflationary pressures, the bank is likely to signal it is prepared to raise rates as early as June.Sources say the Bank of Japan may not raise interest rates at its April meeting.German Chancellor Merz: Brazil has great potential to expand its niobium and rare earth supply, and Germany can provide the relevant technology.

Stocks May See a Reversal As a Result of Bleak GDP Data

Cory Russell

Apr 29, 2022 10:22

Fundamental Analysis of the S&P 500 Index

After rebounding from a fresh low of 4,162.90, the broad stock market index recovered 0.21 percent on Wednesday. The S&P 500 index dropped to its local lows of roughly 4,160 in March. 


Despite quarterly corporate profits disclosures, it continued to fall. There is still a lot of uncertainty about the Fed's tightening monetary policy, as well as the Ukraine crisis. 


Following the publication of Facebook's quarterly earnings report yesterday, the S&P 500 index is predicted to start 1.1 percent higher this morning. However, following significantly poorer than anticipated quarterly Advance GDP figures (-1.4 percent vs. estimates of +1.1 percent), the market retraced some of its overnight gains.

Conclusion

Following recent drops, the S&P 500 index varied on Wednesday. The market ended the day higher, although it remained below the 4,200 level. 


The key Advance GDP announcement today came in substantially lower than predicted. We could see a "sell the rumor, buy the news" scenario here. Investors will also be watching for AAPL and AMZN to deliver their quarterly earnings reports today.

The following is a breakdown:


Yesterday, the S&P 500 index stuck below 4,200; it may seem contradictory, but today's worse-than-expected Advance GDP announcement may cause an upward reversal.

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