Markets mixed, economy “solid”, higher rates “very likely”

Markets were mixed on Thursday.

The Nikkei 225 jumped 1.1 percent and the STOXX Europe 600 rose 0.5 percent. However, the S&P 500 fell 1.1 percent.

“With rate hikes coming and the historically volatile midterm year on the horizon, more violent ups and downs could be in store for investors this year,” said Ryan Detrick of LPL Financial.

However, Detrick added that “we are looking at another solid quarter from corporate America” and that “the underpinnings of the economy remain quite solid”.

Rodrigo Catril, senior FX strategist at National Australia Bank, wrote in a Thursday note that “the economic backdrop is still pointing to an increase in inflationary pressures and resilient growth, pointing to the need for the Fed as well as other central banks to shift towards a tighter policy setting, thus higher global rates over 2022 still look very likely”.