The U.S inflation data drag stocks down from their peak.  The U.S. benchmark indexes slipped over -4%, and they recovered to the moderate decline level after the late rally in the market on the April Consumer Price Index (CPI) last Wednesday, which rose 4.2% from a year ago and 0.8% from March.  The Indexes closed lower about -1% -2.5%  as a weekly loss. The Tech Index Nasdaq- 100 underperformed.

First-quarter earnings of companies in the S&P 500 were up more than 49% from the same period a year earlier―more than double the 24% rate that analysts had projected at the end of March. The annual inflation rate in the U.S soared to 4.2% in April from 2.6% in March and well above market forecasts of 3.6%. It is the highest reading since September of 2008. refer((https://www.usinflationcalculator.com/inflation/current-inflation-rates/.)

U.S INFLATIONreport_2021-05-10-Inflation data Drag Stocks Down

The top European benchmark Indexes ended with the mixed direction of the movement.  The German Index Dax-30 and the Italian Index FTSE-MIB closed higher. On the other hand, The Indexes FTSE-100 and CAC-40 closed with the red mark. Fears of the European Central Bank (ECB) slowing bond purchases also pushed yields higher.

Most APAC benchmark Indexes declined about -1% t0 -4.5% as a weekly loss. The Japan Index Nikkei-225 underperformed. In contrasts, China’s Shanghai Composite Index CSE-50 climbed above 2% for the week on vital economic data.

Weekly market movement

Underlying_2021-05-17-Inflation data Drag Stocks Down

Gold closed higher, about 0.65 as a weekly gain. The U.S Oil rose nearly 0.7% despite the Covid-lockdowns in several parts of India. Elon Musk’s announcement Wednesday that Tesla would no longer accept bitcoin as payment for the purchase of its vehicles caused investors to hit the breaks on the booming cryptocurrency market and drag down into the $45k level. Refer (https://coinmarketcap.com/currencies/bitcoin/news/).

Sentiment Analysis

The below figures shows the news and social media sentiment trend for the week. Inflation data drag stocks down. The global news sentiment trend is continuing to be the mixed direction for the week. The sentiment trend for the U.S benchmark indexes turns into the neutral mode. However, The Industrial Index Dow-30 showing a bearish outlook in sentiment direction.  

The European benchmark Indexes are in the mixed direction of sentiment trend. The Indexes CAC-40 and FTSE-MIB are in a down sentiment trend. On the other hand, the London Index FTSE-100 showing a solid bullish view in sentiment trend.

The primary APAC benchmark indexes show the diversified sentiment direction for the week. The Indexes HSI-50, Nikkei-225, and CSE-50 are showing a strong positive trend in sentiment direction. On the other side, the Indexes ASX-200 and, Kospi-100 are in a strong downtrend.

Sentiment Trend Chart

Sentiment Chart_2021-05-17-Inflation data Drag Stocks Down

The following critical economic data refer to https://www.fxstreet.com/economic-calendar, including existing home sales and the PMI index.

Sentiment Values

Sentiment Table_2021-05-17-Inflation data Drag Stocks Down

Note: The sentiment scores applied as an additional overlay to your existing models to further improve performance.

Buy & Sell Signals

The below table shows the buy/sell signals generated based on InfoTrie’s proprietary Investment/ Trading models. These models developed using technical, fundamental, quantitative techniques and the news-based sentiment score as an additional overlay.

I have tabulated the random signals from several InfoTrie’s Trading/Investment models.

Buy_Sell_2021-05-17-Inflation data Drag Stocks Down

The news sentiment score provides a significant improvement, significant “Alpha” compared to the traditional investment/trading models.

 For more details on the analysis, accessing complete tear sheets or white paper for the models, subscription details for News Sentiment data and other consulting works, please contact us with the information below.

InfoTrie Financial Solutions Pte. Ltd.
Alternative Data, Sentiment Analysis, Financial I.T. and A.I. Consulting

Read our previous blog posts. Want to access our data? Try our API or access our FinSentS platform

contact@infotrie.com
Suresh Kumar Ramani +65 9337 6035
Frederic GEORJON +33 (0)6 1304 0600


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