Industrial production in Israel eased to 9.9 percent year-on-year in April of 2022, slowing from an upwardly revised 19.9 percent rise in the previous month. It was the slowest gain in industrial output since December last year amid a shap slowdown in manufacturing production (2.4 percent vs 14.4 percent in March). On a seasonally adjusted monthly basis, industrial production fell 0.1 percent compared to a downwardly revised 0.3 percent decline in the previous month.

Wall Street gains accelerated in the last hour of trading with the Dow closing 823 points higher, the S&P 500 adding 3%, and the Nasdaq advancing 3.3% as expectations of higher and faster rate hikes cooled. While recessionary fears remained a top concern among investors, recent economic data pointing to a moderation in inflation expectations sparked speculation that central banks may take their foot off the pedal. The University of Michigan survey showed that consumer sentiment hit a record low level in June and its gauge of inflation expectations over the next 5 to 10 years, fell to 3.1% from 3.3%. All three major averages snapped three-week losing streaks with the Dow up 5.4%, the S&P 500 - adding 6.5% - its biggest advance since May 2020, and the Nasdaq surging 7.5%.

New home sales in the United States rose 10.7% from a month earlier to a seasonally adjusted annual rate of 696,000 in May of 2022, above market expectations of 588,000. Sales rose in the West (39.3%) and in the South (12.8%) but declined in the Northeast (-51.1%) and in the Midwest (-18.3%). Despite the rebound in May, elevated house prices and mortgage rates of near 6% are likely to continue to hit sales in the next months. Meanwhile, the median sales price of new houses sold last month was $449,000, up 15% from the previous year, and the average sales price was $511,400. There are now 7.7 months of supply in inventory, compared to 8.3 months in April.

WTI crude futures settled up 3.2% at $107.6 per barrel on Friday as supply concerns outweighed expectations of a slowdown in demand. Production in Libya shut down this week because of unrest, making it even more difficult for OPEC to meet the production targets. Adding to woes, Nigeria’s petroleum minister said OPEC+ is running out of capacity to pump more oil, including its biggest member Saudi Arabia. Still, crude was down 2% on the week on fears that aggressive monetary tightening in major economies aimed at curbing soaring inflation could lead to a global recession and dampen oil demand.

The Ifo Business Climate indicator for Germany fell to 92.3 in June of 2022 from a 3-month high of 93 in the previous month, below market expectations of 92.9 as the threat of gas shortages is of great concern to the German economy. The index of the current situation went down to 99.3 in June from 99.6 the prior month, while the gauge assessing companies' expectations decreased to 85.8 from 86.9. Manufacturing companies assessed the current situation as slightly less good and are considerably more pessimistic about the second half of the year. The chemical industry is thoroughly alarmed. In trade, businesses are much less satisfied with their current situation and the index of their expectations fell to its lowest level since April 2020. Wholesalers and retailers are equally troubled when they look to the coming months. On the other hand, the business climate continued to climb in construction and in the service sector.

European equities finished Friday's session sharply higher, snapping two straight sessions of losses, as inflation worries receded thanks to this week's downturn in commodity prices, which, in turn, poured cold water on the more aggressive rate hike outlooks. Furthermore, lower bond yields increased the appetite for beaten-down, high-value growth stocks. Across sectors, technology stocks led gains while retail shares underperformed. On the data front, Germany's Ifo business climate indicator fell more than expected to 92.3 in June, amid the looming threat of gas shortages. Domestically, the DAX advanced roughly 2%, erasing weekly losses, while the regional Stoxx 600 rallied 2.6% to book a 2.4% weekly gain, snapping three consecutive weeks of losses.