• Global Stocks Dropped as Bank of Japan Disappointed Investors

Global stock markets lost ground last week as Bank of Japan refrained from taking further easing measures, disappointing investors. In the week, S&P index dropped 1.0%, and MSCI EAFE index declined 0.5%. The MSCI Emerging Market Index tumbled by 3.2% as market volatility picked up. Gold price was up by 0.4%. The SPGC commodity index rallied 3.2% on rising oil prices. The bond markets gained as investors shed risks. Barclays US Treasury index climbed by 0.2%, and US high yield bonds was up 0.4%.

• US Retail Sales Rose 0.6% in May

Sales at U.S. retailers rose more than forecast in May, indicating consumers may help propel the world’s largest economy past a second-quarter slowdown. Retail sales climbed 0.6%, the biggest gain in three months, following a 0.1% April increase. The surge was largely driven by a jump in auto sales, which generate about one-fifth of all retail spending. Auto companies sold 1.4 million vehicles, helped by greater discounts or other financial incentives for buyers. Excluding autos, retail sales rose a smaller 0.3%. Sales also rose for suppliers of building materials and garden-related goods, grocery stores and Internet retailers. Warmer weather boosted sales at home improvement stores such as Home Depot and Lowe’s that cater to builders and gardeners.

• Bank of Japan Stayed Pat

The Bank of Japan refrained from taking any additional measures to stimulate growth and ease market volatility, citing signs of economic recovery, but disappointing investors who expected new action to address problems in the government bond market. The bank’s large-scale bond-purchasing program has prompted sharp swings in the government-bond market, and some investors expected the bank to try to address that by expanding a bank loan program. The BOJ offered a relatively upbeat projection for Japan’s economy, a day after the government upgraded its own assessment for growth in the first quarter, saying Japan’s GDP expanded at 4.1% annual pace, the fastest among the advanced economies. The bank cited improvements in exports, resilience in business investment and private consumption.

• A Moderate Reformer Won Iranian Presidential Election

Moderate cleric Hassan Rohani won Iran’s presidential election with a resounding defeat of conservative hardliners, calling it a victory of moderation over extremism and pledging a new tone of respect in international affairs. Though thousands of jubilant Iranians poured onto the streets in celebration of the victory, the outcome will not soon transform Iran’s tense relations with the West, resolve the issues over its nuclear program or lessen its support of Syria’s president in the civil war – matters of national security that remain the domain of Supreme Leader Khamenei.

Top Stories to Watch This Week

• FOMC Meeting

FOMC will meet on Tuesday and Wednesday to decide on monetary policy. Investors will look for hints on the timing of tapering quantitative easing.

• US CPI Inflation

The inflation in the US is expected to remain subdued.

• HSBC Chinese PMI Index

Investors will get a chance to see how healthy the Chinese manufacture sector, which contracted last month.

• US Existing Home Sales

US housing sector should remain strong and existing home sales in May is expected to be 5.01MM.

• US Stocks Rose the First Time in Three Weeks

U.S. stock markets rose this week, the first time in three weeks. On Friday, stocks rose after a solid payrolls report cheered investors by suggesting that economic growth is strong enough to sustain relatively healthy job increases but not so strong that the Federal Reserve might cut back on its stimulus program. In the week, S&P index rose 0.8%, and MSCI EAFE index climbed 0.4%. The MSCI Emerging Market Index dropped by 1.0%. Gold price was off by 0.5%. The SPGC commodity index was up 2.9%. The bond markets were sold off. Barclays US Treasury index declined by 0.3%, and US high yield bonds was down 0.1%.

• US Manufacturing Activities Contracted in May

Manufacturing sector contracted in May as the ISM manufacturing index fell below 50 for the first time since November. The headline index fell more than expected, sliding from 50.7 to 49 for May. The details were weaker than they were in April, as new orders fell from 52.3 to 48.8. The inventory index bucked its normal tendency to decline in May, rising from 46.5 to 49. Therefore, the ISM manufacturing index may be weaker than it appears. Factory conditions, particularly non-auto, have deteriorated. Nevertheless, the next few months will remain difficult as the fiscal drag intensifies.

• European Central Bank Stood Pat on Interest Rates

The European Central Bank on Thursday debated ways to pour more credit to suffering euro zone businesses, but decided not to act. ECB was not sure which way the economy was heading. ECB president, Mario Draghi, said it had lowered its 2013 economic forecast for the euro area. The bank also left its benchmark interest rate unchanged at its already record low rate. The lack of any action illustrated the gap between those at the central bank who expect a weak recovery after a year and a half of contraction and economists and central bankers elsewhere who fear that the euro zone is sinking ever deeper into stagnation.

• US Added 175K Jobs and Unemployment Rate Rose to 7.6%

U.S. firms added 175K jobs in May, steady hiring but below the more robust pace that took place during the fall and winter. The unemployment rate rose to 7.6% from 7.5% in April. The increase occurred because more people came back to market looking for work, a good sign in the job market. The government said the economy added 12K fewer jobs in April and March. Employers have added an average of 155K jobs in past three months, below the average of 237K created from November through February.

The modest gains likely mean the Federal Reserve will continue its bond purchases. The Fed has said it will maintain its pace of bond purchases until the job market improves substantially. The purchases have helped drive down interest rates and boost stock prices.

• Japan Dipped Into Bear Market Briefly on Friday

On Friday, the high-flying Nikkei index posted further declines, at one point extending its slide from a trading high of 15,942.6 points on May 23 to more than 20%. While losses were trimmed by the close, the initial drop briefly put the leading index of Japanese stocks into a bear market. The index closed at 12,878, down 19.2% from its May 23 high. Even with the losses, Japan still boasts one of the best performing stock markets in the world. The Nikkei is up 24% for the year, compared with a gain of about 16% for the S&P 500 index.

Top Stories to Watch This Week

• US Retail Sales

US retail sales in May should rise 0.5%, according to economists, owing to better mix in auto sales and higher reported retail activities.

• Bank of Japan Interest Rate Decision

BOJ is expected to hold interest rates unchanged, but it may extend the term of its low interest fund provision.

• Iran will hold presidential elections on Friday.

• US Stocks Declined for Another Week

U.S. stock markets declined this week, but still finished the month with healthy gains. Treasury yields surged to the highest levels in more than a year, after a strong housing report fuelled fears that an improving economy could push the Fed to taper its bond purchases earlier than expected. In the week, S&P index dropped 1.1%, and MSCI EAFE index declined 2.2%. The MSCI Emerging Market Index tumbled by 3.0%. Gold price climbed 0.1%. The SPGC commodity index was down 1.4%. The bond markets were sold off too. Barclays US Treasury index declined by 1.0%, and US high yield bonds was down 1.9%.

• US Housing Markets Continue to Be Strong

The Standard & Poor’s Case-Shiller home price index showed the biggest gains in seven years. Housing prices rose in every one of the 20 cities tracked, continuing a trend that began three months ago. Similar strength has appeared in new and existing home sales and in building permits, as rising home prices are encouraging construction firms to accelerate building and hiring. The broad-based housing improvements appear to be buoying consumer confidence and spending, countering fears earlier this year that many consumers would pull back in response to government austerity measures.

• Japanese Stocks Entered “Correction” Territory

The Japanese stock market has entered “correction” territory, down about 11% from a five-year high reached on May 22. On the week, the Nikkei Index fell 5.73%. The Japanese stock market has been the best performer year to day.

• Bank of Canada Held Its Interest Rate Steady

The Bank of Canada held its benchmark interest rate steady at 1%. That’s the same level it has been at for 22 consecutive policy meetings. In a statement, the bank said that the Canadian economy performed better than the bank expected in the first part of 2013. But it expects growth to moderate through the year, expanding by about 1.5% as a whole. That likely isn’t enough to compel the bank to raise rates to slow things down and rein in inflation, nor is it sluggish enough to lower the benchmark rate to stimulate the economy further and spur borrowing.

• Euro Zone Unemployment Rate Hit Another Record

Unemployment across the 17 European Union countries that use the euro has hit another record high, the latest weakness for the ailing single currency zone. Unemployment rose to 12.2% in April from the previous record of 12.1% in March. Another 95K people joined the ranks of the unemployed, taking the total to 19.38 million. The figures also mask big disparities among countries. While over 25% of people are unemployed in Greece and Spain, Germany’s rate is down at 5.4%. Inflation in the eurozone rose to 1.4% in the year to May from 1.2% in April. Still, inflation is below the European Central Bank’s target.

Top Stories to Watch This Week

• US ISM Manufacturing Index

US ISM manufacturing index should improve to 52.1 in May according to eocnomists’ survey.

• European Central Bank Interest Rate Decision

ECB is expected to hold interest rates unchanged after May’s cut.

• US Employment Rate and Nonfarm Payrolls

Economists forecast that US added 175K jobs in May and unemployment rate stayed at 7.5%.

• US Stocks Declined From Record Highs

Volatility came back to the stock markets last week. Bernanke’s testimony and data showing China’s manufacturing sector contracted, sent the shares in global plummeting. Japan’s Nikkei sank 7.3% before recovering later. In the week, S&P index dropped 1%, and MSCI EAFE index declined 2.5%. The MSCI Emerging Market Index declined by 2.7%. Gold price climbed 2.1%. The SPGC commodity index was down 1.2%. The bond markets were sold off too. Barclays US Treasury index declined by 0.5%, and US high yield bonds was down 0.8%.

• Bernanke Told Lawmakers the Fed Could Winding Down Its Bond Purchases

Fed chairman Ben Bernanke told lawmakers that the U.S. job market remains weak and that it is too early for the Federal Reserve to slow its extraordinary bond purchase programs. Reducing the Fed’s efforts to keep borrowing rates low would “carry a substantial risk of slowing or ending the economic recovery,” Bernanke said in testimony to the Joint Economic Committee of House and Senate. When pressed by lawmakers, Bernanke said the pace of bond purchases could be reduced over the next few meetings, if the job market shows “real and sustainable progress.” Most of Bernanke’s testimony focused on the many risks facing the economy, along with the benefits gained so far from the Fed’s stimulus. His comments suggest the Fed is not ready to taper the bond purchases in the near future.

• US Durable Goods Orders Rose 3.3% in April

Orders for long-lasting manufactured goods in the US rebounded in April, buoyed by greater demand for aircraft and stronger business investment. The gains suggest economic growth may be holding steady this spring. Orders for durable goods, items expected to last at least three years, rose 3.3% in April. A measure of business investment plans increased 1.2%, and the government revised the March figure to show a 0.9% gain, instead of a slight decrease. Companies ordered more machinery and electronic products, typically signs of confidence. More spending by businesses could ease fears that manufacturing could drag on the economy later this year.

• US Existing Home Sales Hit Three-Year High

Prices surged as sales of existing homes in the US rose in April to the highest level in nearly three and a half years, offering the economy a buffer from the stiff headwinds of belt-tightening from Washington. Existing-home sales had advanced 0.6% to an annual rate of 4.97 million units, the highest level since November 2009. Resale of homes was 9.7% higher than in the same period last year.

• Bank of Japan Stood Pat on Monetary Policy

The Bank of Japan stood pat on monetary policy amid market anxiety over volatility in bond markets, which has threatened to undermine the country’s battle to end deflation and stimulate growth in the Japanese economy. Haruhiko Kuroda, the central bank governor, said Bank of Japan would continue to make large bond purchases. The bank’s board stuck to its strategy of expanding the monetary base at an annual pace of 60 trillion yen to 70 trillion yen, or $586 billion to $684 billion, through purchases of government bonds, commercial debt and other assets.

Top Stories to Watch This Week

• US Housing Market

S&P/Case-Shiller Home Prices will be reported for March on Tuesday.

• Bank of Canada Interest Rate Decision

Bank of Canada will announce its interest rate decision on Wednesday.

• Euro Zone Inflation Rate

Euro Zone Consumer Price Index will be reported on Thursday.

• US Stocks Set Records Again

U.S. stocks rose for the week, setting a few record highs along the way. It was another week of gains even the economic data during the week was a mixed bag, with retail sales and consumer sentiment exceeding expectations and initial jobless claims worse than expected. S&P index rallied 2.2%, and MSCI EAFE index jumped 0.6%. However, the MSCI Emerging Market Index declined by 0.6%. Gold price tumbled 6.1%. The SPGC commodity index was up 0.1% as oil prices rose again. The bond markets were sold off again. Barclays US Treasury index declined by 0.1%, and US high yield bonds was down 0.1%.

• US Retail Sales Rose 0.1% in April

U.S. retail sales rose in April, as consumers bought cars, building materials and other goods. Consumer spending rose 0.1% from the previous month. Excluding the volatile items, like fuel and cars, spending in the overall economy jumped 0.5%. Consumer demand drives about 70% of U.S. economic activity. The report surprised many economists who had predicted that retail sales would decline as the effect of tax increases and government spending cuts worked their way through the economy.

• Euro Zone Economy Shrank for the Sixth Straight Quarter

Economy of the euro zone contracted by a worse-than-expected 0.2% in the first quarter of 2013, keeping the region mired in recession. Economists surveyed expected the euro-zone economy to shrink by 0.1%. However, the data painted a brighter picture than in the fourth quarter last year, when growth rates fell 0.6% and 0.5% respectively. On a country-specific basis, Spain and Italy both shrank 0.5%, while France fell 0.2%. Germany narrowly avoided a contraction, with the economy growing 0.1%.

• Japan GDP Growth Beat Expectations under Abenomics

Japan’s economy kicked into high gear during the first quarter as policymakers worked to combat decades of falling prices and spur growth. Japan’s economy grew at an annual rate of 3.5% in the first quarter of 2013. The expansion was much quicker than the 2.7% increase expected by analysts. On a quarterly basis, Japan’s gross domestic product increased by 0.9%. Consumer spending and exports were particularly strong. The positive data should bolster hopes that the country’s economic outlook is brightening. The growth should also provide a boost to Prime Minister Shinzo Abe’s reform efforts — a set of policies called “Abenomics.”

Top Stories to Watch This Week

• Bernanke Testimony

Fed Chairman Ben Bernanke will testify before the congress on Wednesday. He may give some clue on when the quantitative easing will be scaled back.

• US Durable Goods Order

US durable goods order is expected to rise 1% in April.

• US Housing Markets

US existing home sales is expected to rise to annual pace of 4.98MM in April.

• Japanese Interest Rate Decision

Bank of Japan will issue interest rate decision on Wednesday.

• US Stocks Ended the Week at Record Levels Again

U.S. stocks ended the week at record levels again. The bull markets continued as more
and more retail investors jumped to the bandwagon, buying stocks. S&P index was up by
0.9%, and MSCI EAFE index increased 0.1%. The MSCI Emerging Market Index rose
1.0%. Gold price declined by 0.9%. The SPGC commodity index climbed 0.6% as oil
price rose again. The bond markets were sold off again. Barclays US Treasury index
declined by 0.2% while US high yield bonds was up 0.1%.

• China Returned to Trade Surplus

China’s exports rose 14.7% in April YOY while imports grew 16.8%, leaving the country with a trade surplus of $18.16 billion. That compares with a trade surplus of $18.5 billion a year earlier and deficit of $0.8 billion in March. The 14.7% increase in exports was led by a 57.2% jump in shipments to Hong Kong. Imports were stronger than expected, giving some encouragement about China’s appetite for global commodities. In April, imports from the United States increased 20% year-on-year while exports decreased 0.1%. Exports to the European Union were down 6% and imports up 12%. Trade with Japan decreased; exports by 1.2% and imports 3.3%. Exports to ASEAN and Taiwan rose 37% and 49%, respectively.

• Chinese Consumer Price Index Nudged Higher while Producer Price Index Declined

Chinese inflation nudged higher in April on the back of soaring vegetable prices but the data also pointed to industrial overcapacity and a fragile economic recovery. China’s consumer price index rose 2.4% year on year, rebounding from a temporary dip to 2.1% in March. The rise was fuelled by a jump in the cost of food, especially vegetables, after an unusually cold start to the spring. However, the non-food elements in China’s consumer price index increased just 1.6% year on year, lower than their average rise in the first quarter. Moreover, producer prices fell deeper into deflationary territory, a reflection of lower global commodity prices as well as excess factory capacity.

• Bank of England Kept Interest Rates Unchanged

The Bank of England held off from injecting more stimulus into the U.K.’s fragile economy, but incoming governor Mark Carney is expected to take action to shore up a fledgling recovery within months. The central bank held its benchmark interest rate at 0.5% and left the size of its bond-buying stimulus program at £375 billion ($583 billion). The decision was expected and sterling was little changed.

• Reserve Bank of Australia Cut Benchmark Interest Rate to 2.75%

The Reserve Bank of Australia cut its benchmark interest rate to a record low, driving down Aussie dollar to boost manufacture and employment. Governor Glenn Stevens reduced the overnight cash-rate target by a quarter percentage point to 2.75%, saying in a statement that the Aussie’s record strength “is unusual given the decline in export prices and interest rates.”

Top Stories to Watch This Week

• Retailers Earning Reports

Walmat, JC Penny, and Kohl’s are scheduled to report quarterly earnings.

• US Retail Sales

US retail sales in April are expected to decline slightly 0.2% from March.

• Euro zone GDP

Euro zone GDP declined by 0.9% YOY, according to economists’ survey.

• Japanese GDP

Japanese economy is expected to grow by 0.7% in Q1 13 from Q4 12.

• US Stocks Rose to Record Highs

U.S. stocks rose last week to end at record highs following solid corporate earnings and
better-than-expected job gains in April. S&P index was up by 2.0%, and MSCI EAFE
index rallied 2.0%. The MSCI Emerging Market Index rose 2.9%. Gold price continued
to increase by 0.8%. The SPGC commodity index climbed 1.2% as oil prices rose again.
The bond markets were sold off after the strong job report. Barclays US Treasury index
declined by 0.3% while US high yield bonds was up 1.1%.

• The U.S. Added 165K Jobs and Unemployment Rate Dropped to 7.5% in April

The U.S. added a net 165K jobs in April and the hiring was stronger in March and February than initially reported. The increase in jobs exceeded the 135K forecast of economists. The acceleration in hiring also nudged the unemployment rate down to 7.5% from 7.6%. That’s the lowest level since December 2008. The unemployment rate fell even though the participation rate increased, which is a good sign. Moreover, the number of new jobs created in March was revised up to 138K from 88K, while February’s figure was revised up to 332K from 268K.

• Fed Kept Interest Rates on Hold and QE

The U.S. Federal Reserve kept interest rates on hold, at record lows, to try to keep the U.S. recovery on track. It also reiterated its pledge to purchase $85 billion a month in Treasury bonds and mortgage-backed securities to hold down long-term interest rates and pump cash into the economy.

• European Central Bank Cut Interest Rate by 25 Basis Points

The European Central Bank has slashed its benchmark interest rate by 25 basis points to an all-time low of 0.5%. The rate cut was expected. The ECB has come under significant pressure to cut rates, the first time it has done so in nearly a year, as the economic recovery across the euro zone has struggled or stalled. ECB President Mario Draghi also left open the possibility of cutting rates further.

• US Manufacturing Sector Slowed but Still Expanded

Economic activity in the manufacturing sector expanded in April for the fifth consecutive month. The Institute for Supply Management (ISM) index was 50.7 in April, down 0.6 percentage points from 51.3 in March. At 50.7, the indicator suggests that manufacturing activity is barely growing. ISM’s New Orders Index registered 52.3 in April, an increase of 0.9 point when compared to the March reading of 51.4. This represents growth in new orders for the fourth consecutive month. ISM’s Production Index registered 53 in April, which is an increase of 1.3 points when compared to the 52.2 reported in March.

Top Stories to Watch This Week

• More Earning Reports

Walt Disney and Whole Foods are scheduled to report quarterly earnings.

• Chinese Economy Is on the Spotlight

China will report trade balance and consumer price index.

• BOE and RBA Monetary Policy Meetings

Bank of England and Reserve Bank of Australia will meet to determine monetary policy.

• Global Markets Rallied for the Week

All asset classes across the globe rose last week, as solid corporate earnings and data that
showed the U.S. economy is still on its slow, unimpressive path of growth. S&P index
was up by 1.8%, and MSCI EAFE index rallied 3.4%. The MSCI Emerging
Market Index rose 1.3%. Gold price jumped by 4%. The SPGC commodity index
climbed 2.5% as oil prices reversed the declining trend. The bond markets rose slightly as
well. Barclays US Treasury index was higher by 0.3% and US high yield bonds was up
1.0%.

• Apple Reported a Drop in Earnings

Apple Inc. reported a drop in earnings, along with a substantially higher stock buyback program for shareholders that may buy the company some relief from worried investors who have driven the stock down more than 40% in recent months. Apple said it was raising its dividend by 15% and adding $50 billion to its share buyback program. Most of the discussion on the conference call focused on the company’s lower gross margins for the March quarter and a disappointing forecast for the June period. Shares of Apple closed Tuesday’s regular session up 1.9% at $406.13, but remains well below its peak above the $700 in September.

• US Economy Grew at 2.5% in the First Quarter

The US economy sped up in the first quarter of this year, with output expanding at an annual pace of 2.5%. The number was lower than the 3% forecasters had been expecting. Consumer spending was up, despite fears that the lapse of the temporary payroll tax holiday at the start of the year would hold back how much consumers were willing to spend. The government spending was lower.

• US New Home Sales Rose 417K Last Month

New home sales rose in March as near record-low mortgage rates helped the industry complete the strongest quarter since 2008, putting the economy on firmer footing. Purchases of single-family properties climbed 1.5% last month to a 417K annual pace. The median estimate of economists called for March sales to rise to 416K. Shares of homebuilders such as Toll Brothers Inc. rallied as cheaper borrowing costs and rising household formation bolstered demand.

• Bank of Japan Committed to Boosting Inflation

The Bank of Japan said it expected prices to rise as a result of its ambitious stimulus plan, even as a separate report showed deflation accelerated. Japan’s consumer price index fell by 0.5% in March. Prices have now declined for five consecutive months, underscoring the monumental task facing Governor Haruhiko Kuroda. In a bid to spark inflation, Kuroda is injecting money into the economy on a massive scale. Earlier this month, the central bank said it would start purchasing longer-term debt and securities like ETFs at an annual pace of 60 to 70 trillion yen.

Top Stories to Watch This Week

• More Earning Reports

Facebook, Visa and AIG will report earnings.

• Fed Policy Meeting

FOMC will meet this week, nobody expects much change in monetary policy.

• ECB Policy Meeting

European Central Bank is expected to lower its benchmark interest rate to 0.5% to add stimulus to the struggling economy.

• US Job Reports

Economists predicted the hiring to pick up moderately in April after the disappointed nonfarm payrolls increase of 88K in March.

• PMI Manufacturing Index

US and Chinese manufacturing activities continued to expand in March, according to economists.

• Global Stocks Ended Lower

Global stocked ended the week lower amid the terrorists’ attack on Boston Marathon. S&P index fell by 2.1%, and MSCI EAFE index tumbled 2.2%. The MSCI Emerging Market Index dropped 0.3%. Gold price tumbled by 6%. The SPGC commodity index slumped 2.3% as oil prices continued to decline. The bond markets were little changed. Barclays US Treasury index remained flat and US high yield bonds was down slightly 0.3%.

• Terrorists Attacked Boston Marathon

Terrorism struck again in the U.S. as two bombs ripped through the iconic Boston Marathon on Monday, killing three and injuring more than170 people. One suspect was killed during a firefight with Boston-area police and the other was captured in a boat in the Boston suburb of Watertown on Friday. The city slowly returned to normal after a lockdown on Friday.

• Gold Slid for a Fourth Week

Gold tumbled 6% this week, marking its fourth weekly drop in a row. Gold for June delivery (GCM3) lost $105.80 to settle at $1,395.60 an ounce on the New York Mercantile Exchange. On a percentage basis, it was the biggest weekly loss for a most-active contract since Sept. 23, 2011. Technical selling put a lot of pressure on gold prices.

• Bank Earnings were Mixed Bag

Goldman Sachs Group Inc. and Citigroup Inc. beat estimates. Bank of America Corp. and Wells Fargo & Co. narrowly missed expectations even though they reported sharp profit increases. Morgan Stanley’s first quarter result was surprisingly weak.

• Signs of Weakness in Corporate Earnings

General Electric warned that European economy softened in the first quarter, and weakness was worse than expected. International Business Machines (IBM) missed profit estimates for the first time since 2005, on a drop in revenue from hardware.

• China’s First-Quarter GDP Growth Slowed

The Chinese economic recovery lost some of its momentum during the first quarter of this year, surprising analysts who had expected growth to accelerate on the back of ample credit, strong infrastructure spending and firm exports. The economy expanded by just 7.7% during the first quarter of the year, compared with a year earlier, short of the 8% that economists had projected, and slower than during the previous quarter, when gross domestic product rose 7.9% year-on-year.

Top Stories to Watch This Week

• More Earnings Reports

Apple, Dow Chemical, Bristol-Myers Squibb and UPS will report earnings.

• US First Quarter GDP

The initial US GDP data will show a first quarter growth of 2.8% YOY, according to economists.

• US New Home Sales

Economists expect the new home sales to inch higher in March.

• Bank of Japan Meeting

Bank of Japan will keep interest rates unchanged, but continue aggressive asset purchases.

• S&P 500 Had Worse Week in 2013

U.S. stocks ended the week with a thud, after the nonfarm payrolls report showed much slower growth in jobs than what investors expected. With Friday’s move down, the S&P 500 closed out their weakest week of the year. The S&P index fell by 1.0%, and MSCI EAFE index declined 0.4%. The MSCI Emerging Market Index tumbled 2.2%. Gold price was down by 1.1%. The SPGC commodity index slumped 4.0% as oil prices tumbled. The bond markets rose as investors expected the Fed to continue quantitative easing. Barclays US Treasury index rose 1.2% and US high yield bonds was up slightly 0.2%.

• US Job Creation was the Slowest in Nine Months

American companies hired at the slowest pace in nine months in March, a sign that Washington’s austerity measures could be stealing momentum from the economy. The economy added only 88K jobs and the unemployment rate ticked a tenth of a point lower to 7.6% largely due to people dropping out of the work force. Analysts had expected a gain of 200K. February data has been revised to 268K from 236K, January to 148K from 119K. The household survey showed workforce down by 496K in March, compared with a decline of 130K in February. The labor participation rate fell to 63.3%, the lowest since 1979.

• US Manufacturing Activities Slowed

U.S. manufacturers extended a fourth consecutive month of expansion in March, continuing to grow but at a slower pace, especially in new orders and production. Last month’s ISM index level of 51.3 in overall manufacturing activity was down from 54.2 in February, suggesting that companies continue to exercise caution in hiring and spending. The report is too early to reflect fallout from the $85 billion in federal spending cuts known as the sequester, which was triggered early in March.

• Bank of Japan Launched an Aggressive Campaign Against Deflation

The Bank of Japan launched what promises to be an aggressive campaign against deflation, announcing a bold set of policy measures that exceeded market expectations. The central bank pledged to achieve the 2% inflation target at the “earliest possible time.” The BoJ said it would expand its balance sheet by purchasing longer-term debt and more exotic securities like ETFs. The bank also merged its asset-purchase programs and suspended a rule that prohibited the purchase of longer-term debt. The new purchases — made at an annual pace of 60-70 trillion yen — will double the bank’s monetary base over a two-year period.

• Tensions on Korean Peninsula Continued

North Korea has moved a missile with “considerable range” to its east coast, but the missile is incapable of reaching the US. The North Korea also blocked entry if South Koreans into an industrial park. The heightened tensions have led the United States to postpone congressional testimony by the top U.S. military commander in South Korea and delay a U.S. intercontinental ballistic missile test from a West Coast base.

Top Stories to Watch This Week

• Alcoa Will Kick Off Q1 Earning Season

Alcoa will kicks off the first-quarter earnings season on Monday. JP Morgan, Barclays Capital and Wells Fargo will report earnings later this week.

• China CPI and Trade Balance

China will report March consumer/producer inflation and trade balance. Analysts will get more information on how strong the Chinese economy is.

• US Fed Minutes and Retail Sales

The FOMC minutes will be released on Wednesday, helping shed some lights on the centric bank’s thinking. US Retail Sales are expected to rise by 0.2% in March by analysts.