GENEVA — Asian equities kicked off the week on a mostly positive note on the back of encouraging trade data in China. Chinese exports fell 6.6% in March versus a 14% slump expected by analysts and a 17.2% decline recorded a month earlier. Imports retreated 0.9% y-o-y during the same month versus -9.5% penciled in and -4.0% printed a month earlier. The Chinese trade surplus rose to $19 billion in March, up from $ -7.09 billion printed in February. Due Friday, the Chinese GDP should however confirm a 6% drop in the first quarter. But for now, the market mood seems to hold. Stocks in Sydney gained 1%, Hang Seng and Shanghai’s Composite advanced 0.65% and 0.68% respectively, as Nikkei surged 2.88%. Activity in US and European futures hint at a bullish start as well, following a remarkable performance across the US equities last week. The S&P500 recorded its best rally since 1974 with a 12% rise last week. Yet gains are at jeopardy as the earnings season kicks off this week and no one knows what to expect. Companies themselves are unable to forecast what’s to come in the next quarters. The only thing we know is that a worldwide lockdown took a heavy toll on businesses during the first quarter of the year, but unlike past earnings seasons, we have no plausible benchmark in hand to effectively judge and compare the actual results. The divergence between the highest and the lowest analyst expectations are at record, confirming that financial experts have also lost their mark following an unprecedented halt in economic activity. But businesses with high exposure to global economy and China will likely suffer the most. The first quarter numbers will give a first indication on how bad the coronavirus outbreak hit company earnings; we stand ready for historic drop in results. In this respect, the US stocks, which have entered bull market last week, could well reverse their latest gains. Investors should watch out for two-sided price volatility. Energy and transport will likely be the most hit, while utilities and consumer staples should have been more resilient faced with the historic slump in global economic activity. US banks will start reporting first. While slashed interest rates should start weighing on banks’ interest revenues, the first quarter bank results may not be catastrophic due to an increase in trading revenues. Although trading in equities show no signs of stress just yet, there is a swift move to safety. Gold started the week with a heavy rise in demand. The price of an ounce cleared the $1700 offers as investors piled into the precious metal in preparation for potentially hectic price moves over the coming days and weeks. US treasuries remain bid, with the 10-year US treasury yield below the 0.80% mark. But the US dollar slipped below the 100-mark leaving some space for G10 to advance. The USDJPY retreated to 107.50. The EURUSUD is preparing to test the 50-day moving average (1.0962), if surpassed, should encourage a further rise toward the 1.10 mark. Cable cleared its 50-day moving average (1.2550) and is set to challenge the 200-day moving average (1.2715) on the back of a softening US dollar. Elsewhere, oil currencies are better bid despite the little convincing OPEC+ decision. After a series of heated teleconferences over four days, OPEC+ finally agreed to curb production by a historical 9.7 million barrel per day. The US, Brazil and Canada will cut another 3.7 million barrel per day. Together, the total drop in oil production is around what investors were hoping for, but with the coronavirus-led slowdown taking a toll on the global oil demand, the supply side news could be rapidly forgotten. WTI crude trades below the $23 mark per barrel, confirming that the historic cut didn’t spark the market reaction that oil producers were hoping for. Not only that the OPEC+ cut remained a touch below the lower range of expectations, but more importantly, wide controversies among oil producer nations hinted that a further action is probably unlikely. Hence, oil is left to its destiny this week and should find a direction based on the overall market mood, that will be mostly set by economic data and company results over the coming weeks. — the writer is a senior analyst at Swissquote Bank