The trading week began with strong fall in the US stock markets.

The main reason was the fall in the shares of the technology sector and the service sector, as well as the concerns about trade relations between the US and China. China imposed imports duties on 128 US goods as countermeasures to US import duties on steel and aluminum. For 120 items, including fruit, the duty will be 15%, another 8 items, including pork - 25%. The Ministry of Commerce of the PRC explained that this measure is introduced to protect Chinese interests and compensate damage from the measures taken by the US. Its role was played by statistics on the United States. The report, published by the Institute for Supply Management (ISM), showed that in March, activity in the US manufacturing sector fell more than economists had forecast. The PMI index for the manufacturing sector fell in March to 59.3 points against 60.8 in February. Analysts had expected the figure to drop to 60.1 points. In addition, more detailed information showed: the price index rose in March to 78.1 from 74.2 in February, the employment index fell to 57.3 from 59.7, the index of new orders fell to 61.9 from 64.2, the index production fell to 61.0 from 62.0, and the stock index fell to 55.5 from 56.7.

On Tuesday, the dynamics changed and the major stock indexes finished trading in positive territory, which was helped by the rebound of shares in the technological and consumer sectors. The shares of Amazon and automakers were the main drivers of market growth. General Motors shares rose 2.9% after the company reported a 16% yoy increase in auto sales in March. The shares of Tesla Inc. went up by almost 5.9%, as the company's operating results for the first quarter indicated a progress in the process of increasing production of the sedan for the mass market of Model 3 and optimistic forecasts for the next quarters. In addition, the market was supported by shares of the financial sector, the value of which increased against the backdrop of higher yields on US bonds.

On Wednesday, the growth continued against the backdrop of investors' expectations that the US and China would eventually reach a compromise on trade. In addition, the focus was on the US. As it became known, the index of business activity in the US services sector from the ISM deteriorated in March to 58.8 points from 59.5 points in February. Analysts predicted that the figure will drop only to 59.2 points. At the same time, the seasonally adjusted final index of business activity in the US services sector from Markit reached 54.0 in March against 55.9 in February.

On Thursday, the positive dynamics continued, thanks to the weakening of fears about the possibility of a trade between the US and China. As it became known, the deficit of the US trade balance grew 1.6% in February, reaching a nearly 10-year high, underscoring the seemingly almost impossible task of the Trump administration to drastically reduce the gap, as the president promised. The trade balance deficit rose to $ 57.6 billion from $ 56.7 billion in January, the Commerce Ministry reported, which was the highest since October 2008. At the beginning of the first year of Trump's presidency, the deficit was 24% lower at $ 45.9 billion.

The week ended with a significant drop after President Trump threatened to increase tariffs by $ 100 billion, and Beijing warned that it would rebuff "at any cost." Previously, the US decided to raise duties on Chinese goods by $ 50 billion.

 

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