The top three indices all posted strong gains following Wednesday’s dramatic sell-off, with the S&P 500 moving 6 points shy of regaining the 1,800 mark while the Dow Jones added 109 points in the bag. However, the NASDAQ was the clear leader, moving up nearly 2% to close at 4,123 points. It was the strongest single-day performance by the tech-centered index since October of last year, but investors need to be cautious about the quality of this upswing since year-to-date, the markets are still net negative.

Of course, the biggest fundamental driver for volatility in the equities market was the Federal Reserve’s surprising decision to continue paring down its bond-buying program by $10 billion dollars for the second straight month. This comes despite the fact that jobs growth slowed last month and weakness in the emerging markets continued to apply pressure on stocks. Investors that are looking for the Fed to step in may be disappointed, as economist Paul Edelstein of IHS Global Insight stated that several months of sub-par payroll growth would need to be witnessed before the Fed would consider reversing the taper.


  • U.S. Dollar

    The U.S. dollar index was notably choppy this week as several emerging market currencies were under stress due to global growth concerns and stubbornly weak Chinese economic data. The index hit a high of 80.83 mid-week after the Fed announced that it would continue tapering down their QE program. Thursday’s market action added to the dollar momentum, with the index closing above 81.

  • Dollary/Yen

    The Dollar-Yen pair also experienced a volatile week as it charged back towards the 104 level but was immediately rebuffed by a hawkish Ben Bernanke, which sent the pair tumbling down to 102. With global belt-tightening, it will be exceptionally difficult for the Japanese markets to gain traction after being the top equities market last year.

  • Euro/Dollar

    The Euro-Dollar was not immune to the drama breaking out in the global economy, with the pair stumbling to 135 after hitting multi-year highs only a month ago. Chronic unemployment in the Eurozone as well as a weaker emerging market are amongst the biggest challenges facing the region. 

Winners & Losers

The winner for this week is Canadian Pacific Railway, ticker symbol CP :  

  • Canadian Pacific was one of the few companies that bucked the down pour on Wednesday, with shares popping up 4% to settle in at 147.61.
  • Quarterly net income of $82 million beat Wall Street expectations, while management was also able to bring down operating ratios to an industry leading 65.9%. The positive earnings result was followed up by massive inflows of money, with volume increasing 5-fold over its 3-month trailing average. 

The loser for this week is Triumph Group, ticker symbol TGI :

  • Shares dropped almost 12% of valuation after the aircraft supplier’s quarterly earnings fell well short of analyst expectations.
  • With a comprehensive miss on both revenue and net income which came as a result of production rate cuts on both commercial and military airplane , Triumph Group was forced to lower 2014 guidance by 9-and-a-half percent.