Investing.com - A look at the top five things that rocked markets this past week.
Earnings Season Kicked into Full Gear
US stocks shrugged off a possible US government shutdown to close at record highs as ongoing optimism over earnings spurred investor appetite for risker assets.
Financials got the week off to a good start amid quarterly earnings report from US Bancorp (NYSE:USB), Morgan Stanley (NYSE:MS) and Bank of America (NYSE:BAC) that beat Wall Street estimates, while Goldman Sachs (NYSE:GS) bucked the trend, reporting its first quarterly loss since 2011.
International Business Machines (NYSE:IBM) quarterly report Thursday also garnered attention after the tech company reported quarterly revenue growth for the first time in twenty-three quarters as its move into cloud, artificial intelligence and block chain technology offset declines from its traditional software business.
The S&P 500 closed at a record high on Friday.
WTI Crude Oil Snapped 4-Week Winning Streak
The weekly streak of gains in crude oil prices came to an abrupt end this week as investors weighed the impact of rising US production on OPEC’s efforts to rid the market of excess supplies amid comments from the IEA.
The International Energy Agency (IEA), in its monthly report, warned that rising non-OPEC production would offset a raft of positive factors supporting oil prices including ongoing OPEC-led output cuts.
Crude oil futures settled at $61.44, down 58 cents.
Pound, Sterling Downed the Dollar
It was another miserable week for the dollar as it struggled to find its footing amid a surge in both the pound and sterling.
EUR/USD notched its fifth-straight weekly win, rising above four-year highs despite European Central Bank (ECB) officials’ attempts to quash investor expectations that the central bank would announce plans to unwind its massive stimulus programme at next week’s meeting.
GBP/USD rose to its highest since the June 2016 Brexit vote amid growing expectations that the Bank of England would soon have to raise rates to prevent the economy from overheating.
Gold Fought Off Pressure From Soaring US Government Bond Yields
Gold prices held above four-month highs this week despite coming under pressure from a surge in government bond yields to multi-year highs.
Yields on United States 10-Year this week rose to their highest since 2014 amid strong China economic growth data and rising expectations for faster inflation growth.
Macquarie said that risks of a reversal in gold prices are rising, as it is “harder for gold to ignore the impressive snapback in real yields” since the turn of the year.
Crypto-Market Crashed. Attempted Recovery. But Remains Under Pressure.
A sea of red swept over crypto-markets this week after a crypto-crash Tuesday through Wednesday unfolded in markets, wiping billions of dollars from the market as investors fled positions amid fears that China and Korea were planning a ban on cryptocurrency-related activity.
The total cryptocurrency market cap slumped to a low of about $478 billion at the depths of the crash on Wednesday before rebounding to about $562 billion Friday. That is markedly lower than the $829 billion total market cap peak set less than two weeks ago on Jan. 7.
As the sell-off deepened, Ripple XRP fell to a low of $0.87 on the poloniex exchange, Ethereum fell to a low of $770, Bitcoin fell to a low $9,231. The ‘big 3’ cryptocurrencies by market cap, however, have since recovered some of their losses but remain under pressure.