Weekly Wrap-Up

Last Week In Markets: Aug 27 - Aug 31, 2018

Fisher Investments recaps the biggest market, political and economic news from last week, including the second estimate of US GDP growth, eurozone money supply growth and China Purchasing Mangers’ Indexes.

Global equities rose amid sparse data reports. US economic data were light. The second estimate of Q2 2018 GDP was revised up to 4.2% q/q annualized—beating estimates. July personal income rose 0.3% m/m, missing expectations. July wholesale inventories increased 0.1% m/m. On Monday, the US and Mexico reached a preliminary pact to overhaul parts of the North American Free Trade Agreement. A deal with Canada is still being negotiated, with talks to continue next week. However, any agreement to modify NAFTA still needs to be ratified by each country’s legislative body.

In the eurozone, August core consumer prices (excluding energy, food, alcohol and tobacco) were just shy of expectations, rising 1.0% y/y. Money supply (M3) grew 4.0% y/y in July, less than the previous month. July loan growth grew 3.0% y/y, as expected. July unemployment remained steady at 8.2%. In the UK, August home prices rose 2.0% y/y. The second estimate of French Q2 2018 GDP rose 1.7% y/y, in line with market estimates. July German retail sales rose 0.8% y/y.

In Asia, China’s official manufacturing and non-manufacturing Purchasing Managers’ Indexes (PMIs), including large, state-owned firms, rose to 51.3 and 54.2, respectively. Japan’s July imports and exports rose 14.6% and 3.9% y/y, respectively—in line with expectations. July industrial production grew 2.3% y/y. July retail sales grew 1.5% y/y, slightly lower than the consensus. July unemployment edged up to 2.5%.

The Week Ahead:

The US releases August manufacturing and services PMIs, nonfarm payrolls and the unemployment rate. The eurozone releases the third estimate of Q2 2018 GDP, July retail sales and August PMI figures. The UK releases August retail sales and PMIs. Both China and Japan release August PMI data.

Tip of the Week:

Fisher Investments’ offices and US markets will be closed Monday, September 3 in observance of Labor Day.

Source for all data cited is FactSet. This update constitutes the general views of Fisher Investments and should not be regarded as personalized investment advice. No assurances are made we will continue to hold these views, which may change at any time based on new information, analysis or reconsideration. In addition, no assurances are made regarding the accuracy of any forecast made herein. Global equities are represented by the MSCI World Index. The MSCI World Index measures the performance of selected stocks in 23 developed countries and is presented net of dividend withholding taxes and uses a Luxembourg tax basis. Past performance is no guarantee of future results. A risk of loss is involved with investments in stock markets.