Last Week in Markets Weekly Wrap-Up

Last Week In Markets: Aug 29 - Sep 02 2022

Fisher Investments recaps the biggest market, political and economic news from last week, including US August unemployment, UK July money supply (M4) and Japanese trade data.

In the US, the final August S&P Global Manufacturing Purchasing Managers’ Index (PMI) was 51.5—signaling modest expansion (readings above 50 indicate expansion). July durable goods orders fell 0.1% m/m, missing expectations. Stripping out more volatile transportation orders showed a 0.2% m/m increase instead. August nonfarm payrolls increased by 315,000, more than anticipated. The August unemployment rate rose slightly to 3.7% from last month’s 3.5%. Lately, economic data have been coming out a bit better than expected, which helps lay down the baseline reality from which to gauge investor sentiment. Many see these better-than-expected data as indicating central banks will tighten policy much more from here, knocking stocks. But investors broadly viewing data through a dour lens has historically been the foundation of bull markets. For more, please see our 8/31/2022 commentary, “An Economic Data Check-In.”

In the eurozone, the final August S&P Global Manufacturing PMI came in at 49.6. August flash core consumer prices (excluding food, energy, alcohol and tobacco) rose 4.3% y/y, higher than expected. The July unemployment rate fell slightly to 6.6%. In the UK, the final August S&P Global/CIPS flash Manufacturing PMI was 47.3. July money supply (M4) rose 0.5% m/m and 4.4% y/y—both higher than previous reports.   

In Japan, the final August Jibun Bank Manufacturing PMI was 51.5. July imports and exports rose 47.2% y/y and 19.0% y/y, respectively, both matching consensus estimates. Preliminary July industrial production rose 1.0% m/m but fell 1.8% y/y. Preliminary July retail sales rose 0.8% m/m and 2.4% y/y. The July unemployment rate remained steady at 2.6%. In China, the Caixin Manufacturing PMI was 49.5, missing expectations.

The Week Ahead:

The US, UK, eurozone, Japan and China release final August services PMIs. The eurozone and Japan report their final Q2 2022 GDP readings. The eurozone releases July retail sales and Q2 trade data. Japan and China report August money supply (M2). China announces August trade data and consumer prices. Japan reports August lending figures. The European Central Bank meets to set monetary policy.

Tip of the Week:

Fisher Investments’ offices will be closed on Monday, September 5 in observance of Labor Day. We will resume normal business hours on Tuesday, September 6.

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 the maximum rate applicable to non-resident institutional investors who do not benefit from double taxation treaties. Past performance is no guarantee of future results. A risk of loss is involved with investments in stock markets.