9 min readWeekly Recap:
US Global stocks recap
US and global stocks rallied strongly last week, supported by optimism over a two-week ceasefire between the US and Iran, raising hopes of a more durable de-escalation. The relief rally saw the Nasdaq jump 4.6% over the week, while oil prices fell around 15% despite the Strait of Hormuz remaining effectively closed.
While markets were hopeful that a more permanent agreement could be reached, sentiment remained fragile amid uncertainty about the negotiations.
Major US data/themes
The importance of finding an off-ramp from the conflict was underscored by hotter-than-expected US inflation data, which showed the largest price increase in four years. CPI rose to 3.3% YoY in March from 2.4%, highlighting the risk that higher energy prices could begin to weigh on consumer spending and broader economic activity.
Gold moves
Gold rose 1.5% last week, supported by a weaker US dollar and falling Treasury yields, as markets grew increasingly optimistic about a potential de-escalation in the Middle East ahead of peace talks between the US and Iran over the weekend.
However, sentiment shifted sharply after hotter-than-expected US inflation data on Friday, combined with the collapse of talks over the weekend and a renewed surge in oil and gas prices, which reignited inflation concerns.
As a result, markets have scaled back expectations for Federal Reserve rate cuts over the next 12 months, according to CME Group FedWatch data. This environment is typically negative for gold and other non-yielding assets, as higher-for-longer interest rates increase the opportunity cost of holding them.
As such, the persistence of elevated rates has overshadowed gold’s traditional safe-haven appeal, keeping the yellow metal under pressure at the start of the new week. That said, any renewed signs of de-escalation could support a recovery in gold prices.
At the same time, attention will also turn to the upcoming US Producer Price Index (PPI) data for further direction.
Oil moves
Oil prices fell more than 10% last week amid optimism surrounding a two-week ceasefire between the US and Iran and ahead of weekend peace talks, even though the Strait of Hormuz remained effectively closed, with only limited shipping activity passing through the critical chokepoint.
However, the collapse of talks over the weekend and Donald Trump’s announcement of plans to deploy the US Navy to fully blockade the Strait of Hormuz are expected to tighten global oil supply further, heightening concerns about scarcity.
As a result, oil prices have surged back above $100 per barrel, with WTI crude oil futures trading around 8.5% higher on the week. Market focus will remain firmly on developments in the Middle East, with any escalation likely to push prices higher. At the same time, signs of de-escalation could see oil fall back below the $100 level.
Indian markets
Indian markets staged a sharp rebound last week, with the Nifty 50 closing up 5.8% and the BSE Sensex rising 5.7%. The rally saw both indices recoup losses from the previous three weeks and marked the strongest weekly performance since February 2021.
Despite the solid rebound, sentiment remains sensitive to geopolitical risks and commodity price movements, both of which could influence market direction in the near term.
Foreign institutional investors (FIIs) remained net sellers over the week, offloading equities worth ₹20,710 crore. This brought total outflows for April to approximately ₹23,972 crore. However, the pace of selling eased toward the end of the week, with FIIs turning net buyers on Friday for the first time in 27 sessions—an early sign that sentiment may be stabilising.
Meanwhile, domestic institutional investors (DIIs) continue to provide strong support to the market.
Key Indian market drivers: The coming week is expected to be driven by geopolitical developments and the start of both the US and Indian earnings seasons. Earnings from ICICI Prudential Asset Management Company, HDFC Asset Management Company, and Wipro will be closely monitored for as well as for forward guidance.
On the data front, investors will focus on India’s CPI and WPI inflation prints, as well as US PPI data, all of which could shape expectations for interest rates and broader risk sentiment.
USD/INR weakened by 0.41% last week, closing at 93.09, and has continued to decline at the start of this week. The currency is coming under renewed pressure as oil prices rise following the breakdown in US–Iran peace negotiations, highlighting India’s vulnerability as a major energy importer.
Pakistan markets
The KSE-100 Index snapped a 10-week losing streak, supported by easing geopolitical tensions after Pakistan helped broker peace talks between the US and Iran. Improved sentiment drove a sharp rally, with the index rising 11.2% week-on-week—its strongest weekly gain since May 2025.
On the data front, workers’ remittances for March were $3.8 billion, down 5% year-on-year but up 17% month-on-month. Pakistan also met key external obligations, successfully repaying a €1.3 billion Eurobond that matured on 8 April.
Additional support came from the International Monetary Fund, which included Pakistan as part of a broader $50 billion financial support package for vulnerable economies affected by Middle East tensions. However, the World Bank revised Pakistan’s GDP growth forecast down to 3%, reflecting ongoing structural and external challenges.
Looking ahead, market sentiment is likely to remain closely tied to geopolitical developments, oil price volatility, and corporate earnings season.
The Pakistani rupee remained broadly stable, appreciating slightly by 0.03% to close at 279.01 against the US dollar. Meanwhile, foreign exchange reserves held by the State Bank of Pakistan rose marginally by $18.6 million to $16.4 billion in the week ending 3 April.
Week ahead (US & Asia)
US earnings season
While the Middle East will remain the key focus, attention also turns to the US earnings season, which begins this week with major banks reporting. Around 70% of S&P 500 companies are expected to release their Q1 results by the end of April. According to FactSet, earnings are forecast to grow by 13.2% year-on-year, marking the sixth consecutive quarter of double-digit growth, while revenues are expected to rise 9.7%, the strongest pace since 2022.
All 11 sectors are projected to deliver revenue growth, led by technology, communications, and financials, although the focus will be firmly on forward guidance given the uncertain macro backdrop. Upbeat earnings could offer some support for stocks and the S&P 500, but only if there are signs of de-escalation in the war.
Indian Inflation (Tuesday)
Indian inflation data will be a key trigger this week, with both WPI and CPI print scheduled for 14 and 15 April. WPI is expected to rise in March after rising to 2.13% year-on-year in February. Elevated commodity prices will likely keep this print high for the foreseeable future.
Meanwhile, CPI inflation rose to 3.21% year-on-year in the previous print and is expected to remain around the 3% to 3.2% range. The data comes after the RBI left rates unchanged at 5.25% last week, in line with expectations, as policymakers wait and watch for the impact of the Middle East conflict.
They warned of lower growth and higher inflation. Hotter-than-forecast inflation could pull Indian stocks, such as the Sensex, lower.
US PPI (Tuesday)
The March PPI report, due on Tuesday, will provide further insight into inflationary pressures at the wholesale level. Producer prices are expected to have risen 1.2% month-on-month, up from 0.7% in February, as higher energy prices start to show up in the data.
The previous reading was already surprising to the upside. Annual PPI stood at 3.4% in February, reinforcing the view that inflation remains sticky even before the recent energy shock starts to feed in. This could reduce the likelihood of Federal Reserve rate cuts in the near term and may provide support for the US dollar.
China GDP (Thursday)
China’s GDP data, due on Thursday, is expected to show the economy grew by around 4.8% year-on-year in the first quarter, with some indicators pointing to stronger growth of around 5%. Industrial production has remained firm, and unemployment is expected to hold near 5.3%, broadly in line with the government’s target.
However, the key question is whether this early-year momentum can be sustained beyond the seasonal effects of the Lunar New Year. Manufacturing and exports remain supportive. However, weakness in the property sector continues to weigh on investment, and rising energy costs are an additional external risk. Solid data could support sentiment and Hang Seng.
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