Weekly Market Review - 07-04-2026

Apr 7
6 min read

Global markets moved higher this week, with investor sentiment improving following a period of heightened volatility. While geopolitical tensions remain a key source of uncertainty, markets have shown resilience, supported by stabilising commodity prices and renewed confidence in growth sectors. At the same time, inflation dynamics and central bank expectations continue to shape the outlook, with investors balancing short-term risks against a more constructive medium-term backdrop.

Market Recap.

Equity markets experienced a stronger week overall, with major indices moving higher as investor sentiment improved despite ongoing geopolitical and political uncertainty.

UK equities saw solid gains, with the FTSE 100 ETF rising 3.14%, supported by strength across large-cap stocks and a rebound in risk appetite following recent volatility.

US markets also moved higher over the week. The Dow Jones Industrial Average ETF increased by 1.76%, while the S&P 500 ETF gained 2.30%, reflecting broader strength across the US equity market. Technology stocks led the rally, with the Nasdaq 100 ETF rising 3.06%, highlighting renewed investor confidence in growth sectors.

Overall, the week reflected a more positive tone across global markets, though underlying uncertainty remains. Political developments in the United States continue to create bouts of volatility, as markets react to shifting expectations around trade, fiscal policy and international relations.

News.

The UK’s Targeted Support Scheme comes into effect this week, marking a significant regulatory shift in how financial firms can support consumers.

Under the new framework, authorised firms are now allowed to provide tailored, non-advised product suggestions to groups of customers with similar characteristics. This is designed to bridge the long-standing gap between full financial advice and generic guidance, enabling more personalised support without the need for formal advice processes.

In practice, this could include suggesting appropriate options such as low-cost ISAs, savings products, or retirement solutions, helping individuals make more informed financial decisions in a simpler and more accessible way.

The Financial Conduct Authority (FCA) has positioned the initiative as part of a broader effort to improve consumer outcomes, stating that “firms should ensure they are delivering good outcomes for customers, particularly those in vulnerable circumstances.”

Inflation.

Inflation in the Eurozone has moved back above target, with the latest Eurostat flash estimate showing annual inflation rising to 2.50% in March, up from 1.90% in February.

The increase has been largely driven by a sharp rebound in energy prices, which rose by around 4.90% year-on-year, reversing the declines seen earlier in the year. This reflects the continued impact of geopolitical tensions on oil and gas markets, which are now feeding through into broader price levels.

Despite the headline increase, underlying inflation pressures remain more contained. Core inflation (excluding energy and food) edged slightly lower to around 2.30%, suggesting that while external shocks are pushing prices higher, domestic demand pressures are not accelerating at the same pace.

From a policy perspective, this creates a more complex backdrop for the European Central Bank (ECB). Inflation is now back above the ECB’s 2.00% target, and markets are increasingly questioning whether interest rate cuts will be delayed or even reversed if energy-driven pressures persist.

Central Banks.

Central banks remain cautious as they assess the impact of recent energy-driven inflation, with policymakers signalling a willingness to look through short-term price shocks.

Recent commentary from the European Central Bank (ECB) suggests that officials are unlikely to respond aggressively if the latest rise in energy prices proves temporary. As one policymaker noted, “we should not overreact to short-term movements in energy prices if they are expected to fade.”

This reflects a more measured approach, with the ECB focused on underlying inflation trends rather than reacting to volatile external factors. The key consideration remains whether higher energy costs feed into broader, more persistent price pressures across the economy.

From a market perspective, this stance provides some reassurance that central banks will avoid overreacting to short-term volatility, supporting expectations that policy easing could still be on the table later in the year if inflation continues to stabilise.

Commodities.

Commodity markets have remained volatile following the Easter bank holiday weekend, although price pressures have eased slightly compared to the sharp spikes seen in late March.

Gold is currently trading around $2,200 per ounce, while silver is near $25 per ounce, continuing to hold firm as investors balance safe-haven demand with evolving expectations around interest rates.

In energy markets, oil prices remain elevated but have moderated from recent highs. WTI crude is trading around $81 per barrel, while Brent crude is near $85 per barrel.

The earlier surge in prices was driven by escalating tensions in the Middle East and concerns over potential disruption to key supply routes, particularly the Strait of Hormuz. While those risks remain, markets have stabilised somewhat as immediate supply disruptions have yet to materialise.

ESG.

The UK has reported a continued decline in greenhouse gas emissions, with total emissions falling by 2.00% to 367 million tonnes in 2025, highlighting ongoing progress toward its long-term climate targets.

The reduction reflects a combination of structural shifts in the energy system, including increased renewable energy generation and a continued move away from fossil fuels, alongside improvements in energy efficiency across industries and households.

While the pace of decline is more gradual than in previous years, the data suggests that the UK remains broadly on track in its transition toward a lower-carbon economy. However, policymakers face the ongoing challenge of sustaining momentum, particularly in harder-to-decarbonise sectors such as transport and heavy industry.

From a market perspective, the trend reinforces the growing importance of energy transition strategies, with continued investment expected in renewables, infrastructure, and low-carbon technologies as the UK works toward its net-zero ambitions.

Geopolitics.

As we now enter week 4 of the Iran conflict, the situation remains largely unchanged from previous weeks, with tensions continuing at an elevated level and developments evolving on a near-daily basis.

Much like last week and the week before, the backdrop is characterised by ongoing military exchanges, heightened rhetoric, and continued uncertainty around the potential for further escalation. While there have been no shifts toward either full escalation or de-escalation, the persistence of the conflict continues to weigh on global markets.

Current updates point to continued strikes across key areas in the region, alongside ongoing concerns around critical infrastructure and energy supply routes. The Strait of Hormuz remains a focal point for markets, given its importance to global oil transport, with any disruption posing a significant risk to energy prices and inflation.

At the same time, diplomatic efforts remain ongoing, though progress appears limited. Global powers continue to call for restraint, but the situation remains highly fluid and subject to rapid change.

Overall, while the narrative has stabilised, the risk environment has not. Markets remain sensitive to any shift in tone or escalation, with geopolitical uncertainty continuing to act as a key driver of volatility.

Week Ahead.

United States

In the United States, attention shifts to inflation and consumer sentiment data following last week’s labour market releases. On Thursday 10 April, the latest Consumer Price Index (CPI) data is due, providing a key update on inflation trends and likely influencing expectations around Federal Reserve policy.

Later in the week, on Friday 11 April, the University of Michigan Consumer Sentiment Index (preliminary) will offer insight into consumer confidence and inflation expectations, both of which remain important indicators for the economic outlook.

United Kingdom In the UK, the data calendar is relatively lighter, with focus turning to housing and broader economic indicators. Early in the week, the Halifax House Price Index is expected, providing an update on housing market conditions amid higher interest rates.

Markets will also continue to monitor developments around government policy, particularly in response to ongoing geopolitical tensions and energy price pressures. There are no major Bank of England policy announcements scheduled this week, with the next Monetary Policy Committee (MPC) decision set for later in the month.

Eurozone

Across the Eurozone, attention will centre on inflation and central bank communication. Following recent data showing a pickup in inflation, markets will be watching closely for any further signals from policymakers.

The European Central Bank (ECB) publishes accounts of its latest monetary policy meeting on Thursday 10 April, which may provide additional insight into how policymakers are assessing recent energy-driven price pressures.

In addition, markets will continue to monitor economic indicators and commentary for signs of how resilient the region remains in the face of ongoing geopolitical uncertainty.

It is important to note that the geopolitical situation remains highly fluid, and developments are changing rapidly. As such, the outlook may shift quickly as new information emerges.