Holy Week was extremely interesting. However, this time political events were in the spotlight, while the latest macroeconomic data releases remained in the background. The increase in tension between the US and North Korea stepped up fears of a possible armed conflict outbreak. Furthermore, the latest French polls showed that the race to the presidential chair would be really fierce and the support for eurosceptics was really significant. As a result, investors started looking for safe havens, so it was not a surprise that the price of gold went up appreciable. Moreover, the market sentiment was bearish last week – most of major global stock market indices moved towards south. During the whole week, French CAC40 declined by 1.3%, German DAX went down by 1%, whereas British FTSE250 grew by 1.5%. In the US, the NASDAQ fell by 1.2%, the S&P500 deteriorated by 1.1% and the DJI dropped by 1%.

Last week, the performance of major global stock market indices was diversified. During the whole week, the NASDAQ fell by 0.6%, the S&P500 went down by 0.3% and the DJI did not see any changes. In Europe, British FTSE250 increased 1.4%, French CAC40 soared by 0.3%, while German DAX deteriorated by 0.7%. This time the minutes from the last meetings of the FOMC and the ECB Governing Council were in the spotlight. The documents dispelled all doubts in the market. The Fed is going to raise interest rates two more times in 2017 and it does not expect that the announced economic reforms will influence the further shape of the monetary policy. It should be also noted that the work on changes in the tax system may take a long time, as the US Government has not been able to work out a common position.

The failure of Donald Trump in Congress turned out to be only a short - term bearish incentive. Last week, major global stock market indices returned to the path of growth. During the whole week, the NASDAQ increased by 1.4%, the S&P500 soared by 0.8% and the DJI went up by 0.3%. In Europe, German DAX increased by 2.1%, French CAC40 took off by 2%, while British FTSE250 fell by 0.1%. Nevertheless, political risk remains active, so it may be very important in a broader perspective. Last week, there were a lot of public appearances of the FOMC representatives. Most of them turned out to be hawkish. In addition, investors learnt plenty of macroeconomic data. This confirmed solid condition of the world’s largest economies. In the US, the releases of the Conference Board Index (125.6 pts.) and the Chicago PMI (57.7 pts.) did not fail.

Despite the lack of strong bearish incentives, major global stock market indices liked the red color last week. During the last five days, the DJI went down by 1.5%, the S&P500 fell by 1.4% and the NASDAQ declined by 1.2%. In Europe, British FTSE250 decreased by 0.6%, German DAX deteriorated by 0.3% and French CAC40 shrank by 0.2%. Attention should be paid to the next pro – restrictive public appearances of the FOMC representatives, which in the eyes of investors were not hawkish enough. In addition, the initially postponed voting of the Congress on health reform was not completed – the proposed law was withdrawn due to the insufficient number of votes. This was quite bad news for the federal budget.

The last week brought a lot of very interesting economic events. The FOMC was in the spotlight. In line with the market consensus, the council raised interest rates by 25 basis points. The public appearance of Janet Yellen was definitely pro – restrictive, however, some investors expected a much more hawkish attitude of the Fed’s president. Thus, all indicated that the FOMC would raise the cost of money two more times in 2017. Nonetheless, the council’s projections did not take account of the potential stimulus package announced by Donald Trump. Its potential implementation may encourage Fed to further hawkish decisions.