French Election Fallout


Monday kicks off the week with the result of the French presidential first round, whichis dominating the European open.

For more reaction to the result and how markets have responded, read our snapshot look at the markets on Monday morning.

UK Snap Election Build-up


The UK’s snap General Election may look like a sideshow for global markets if we do end up with a Le Pen versus Melenchon run-off in May. Nevertheless the big market swings we saw last Tuesday when Theresa May announced the shock decision to hold a snap vote in June shows the risks for investors and the potential for considerable volatility in the coming weeks.

The pound enjoyed one of its best days in a decade, rising 2.7% to climb to a six-month high as markets took the news as a sign that the government would be able to pursue a softer, more market-friendly version of Brexit. With large swathes of traders short sterling the ramp produced a classic short squeeze as bears were forced to liquidate positions and buy back sterling.

Meanwhile, the FTSE 100 plunged as UK stocks and the pound carried on their inverse correlation. The drop, the worst since immediately after the EU referendum last June, wiped out gains for 2017.



On the corporate front, US earnings season is in full swing with a raft of S&P 500 and Dow components reporting Q1 numbers.

Tech Thursday sees heavyweights Alphabet (GOOGL), Amazon (AMZN) and Microsoft (MSFT) report. There is also a group of significant ‘Trump trade’ stocks due to report, including defence groups Raytheon (RTN), Northrop Grumman (NOC) and Lockheed Martin (LMT).

Ford (F), General Motors (GM), Boeing (BA), McDonald’s (MCD), Chevron (CVX) and Exxon Mobil (XOM) are among some of the other large-cap stocks reporting this week, which is sure to make for a volatile week on the big US indices.

In the UK, it’s a busy week for bank earnings, with Q1 numbers from Lloyds (LLOY), Royal Bank of Scotland (RBS) and Barclays (BARC) top of the bill for the FTSE 100. Thursday is a big day for ex-dividend factors which should clip a few points off both the blue chip index and the FTSE 250.

GDP Readings


Friday is GDP day, with the advanced readings of the first quarter growth in the UK and US due out. Britain’s economy has proved markedly resilient since the EU Referendum, but as inflation climbs there are fears this will hit consumer spending and result in a slowdown in the economy. Estimates indicate Q1 growth should be around 0.6%. The US reading for the first quarter will be closely watched in light of expectations the Federal Reserve is moving away from hiking rates again in June. A GDP beat could put that back on the table and boost the US dollar in the process. Estimates from different regional Fed banks suggest the figure could be anywhere between 1% and 3%, which significantly raises the prospect of volatility in USD pairs.



Finally the European Central Bank (ECB) convenes again on Thursday. With French elections likely to still to be a factor and inflation having slid back, it’s unlikely that policymakers will use this meeting for any major change in direction. Nevertheless there is likely to be the usual pre- and post-press conference volatility in euro pairs, especially EURUSD.

Economic Calendar

(All times BST)

Monday, 24th April

09:00 – German Ifo Business Climate

16:30 – FOMC member Kashkari due to speak

Tuesday, 25th April

All day – Italy, New Zealand and Australia bank holidays

09:30 – UK public sector net borrowing

15:00 – US CB consumer confidence, new home sales

Wednesday, 26th April

02:30 – Australia CPI inflation

13:30 – Canada core retail sales

15:30 – US crude oil inventories


Thursday, 27th April

Tentative – Bank of Japan monetary policy statement

07:00 – Spanish unemployment rate

08:00 – Spanish flash CPI inflation

12:45 – ECB interest rate decision

13:00 – German preliminary CPI inflation

13:30 – ECB press conference

13:30 – US core durable goods orders

Friday, 28th April

00:30 – Japan household spending, national core CPI, Tokyo core CPI, unemployment

00:50 – Japan preliminary industrial production, retail sales

09:30 – UK preliminary Q1 GDP reading

10:00 – Eurozone flash CPI estimate

13:30 – US advance Q1 GDP reading

14:45 – US Chicago PMI

15:00 – Revised UoM consumer sentiment

Corporate Calendar


Monday, 24th April

Alcoa (AA) – Q1/2017, EPS estimate 0.474

Hasbro (HAS) – Q1/2017, EPS estimate 0.412

Anglo American (AAL) – Trading update

Tuesday, 25th April

3M Co (MMM) – Q1/2017, EPS estimate 2.068

AT&T (T) – Q1/2017, EPS estimate 0.741

Biogen (BIIB) – Q1/2017, EPS estimate 4.996

Caterpillar (CAT) – Q1/2017, EPS estimate 0.620

Chipotle Mexican Grill (CMG) – Q1/2017, EPS estimate 1.268

Coca-Cola (KO) – Q1/2017, EPS estimate 0.437

Lockheed Martin (LMT) – Q1/2017, EPS estimate 2.798

McDonald’s Corp (MCD) – Q1/2017, EPS estimate 1.333

Xerox Corp (XRX) – Q1/2017, EPS estimate 0.159

Circassia Pharmaceuticals (CIR) – Y/2016, EPS estimate -0.328

Whitbread (WTB) – Y/2017, EPS estimate 2.454

Wednesday, 26th April

Boeing (BA) – Q1/2017, EPS estimate 1.970

Northrop Grumman (NOC) – Q1/2017, EPS estimate 2.928

Procter & Gamble (PG) – Q3/2017, EPS estimate 0.938

GlaxoSmithKline (GSK) – Q1/2017, EPS estimate 0.261

Tullow Oil (TLW) – Trading update

Thursday, 27th April

Alphabet (GOOGL) – Q1/2017, EPS estimate 7.408 (AMZN) – Q1/2017, EPS estimate 1.081

American Airlines Group (AAL) – Q1/2017, EPS estimate 0.554

Domino’s Pizza (DPZ) – Q1/2017, EPS estimate 1.171

Dow Chemical Co (DOW) – Q1/2017, EPS estimate 0.969

Ford Motor Co (F) –Q1/2017, EPS estimate 0.388

Intel Corp (INTC) – Q1/2017, EPS estimate 0.649

Microsoft Corp (MSFT) – Q1/2017, EPS estimate 0.699

Raytheon (RTN) – Q1/2017, EPS estimate 1.597

Starbucks (SBUX) – Q2/2017, EPS estimate 0.448

Allied Minds (ALM) – Y/2016, EPS estimate -0.395

Lloyds Banking Group (LLOY) – Q1/2017, EPS estimate 0.015

WPP (WPP) – Q1/2017, EPS estimate 0.740

Persimmon (PSN) – trading update

Taylor Wimpey (TW) – trading update

Friday, 28th April

Chevron (CVX) – Q1/2017, EPS estimate 0.922

Exxon Mobil (XOM) – Q1/2017, EPS estimate 0.875

General Motors (GM) – Q1/2017, EPS estimate 1.451

Royal Bank of Scotland (RBS) – Q1/2017, EPS estimate 0.046

Barclays (BARC) – Q1/2017, EPS estimate 0.053

HSBC Holdings (HSBCA) - AGM

Source: Bloomberg

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