Fisher Investments recaps the biggest market, political and economic news from last week, including US trade data, and UK and Japanese Purchasing Managers’ Indexes (PMIs).
Global equities rose 3.4% as the US impeachment trial and Wuhan coronavirus continued to dominate headlines. In the US, the January Markit Manufacturing and Services Purchasing Managers’ Indexes (PMIs) came in at 51.9 and 53.4, respectively, both slightly beating expectations. The January ISM Manufacturing and Non-Manufacturing PMIs rose to 50.9 and 55.5, respectively. All four PMI readings indicated expansion. December exports and imports increased 0.8% m/m and 2.7% m/m, respectively. On Monday, Iowa held caucuses for the presidential primary candidates. While the Democratic results were delayed due to technical issues, as of this writing, South Bend Mayor Pete Buttigieg and Vermont Senator Bernie Sanders topped the polls receiving 13 and 12 delegates, respectively. For more, please see our 2/6/2020 article, “The Iowa Debacle’s Timeless Lesson for Investors.” On Wednesday, the Senate acquitted President Trump of both impeachment charges. Utah Senator Mitt Romney was the sole Republican to cross party lines and vote for a guilty verdict on the abuse of power charge.
In the UK, the January Markit/CIPS Manufacturing and Services PMIs rose to 50.0 and 53.9 respectively, both beating expectations. In the eurozone, January Markit Manufacturing and Services PMIs increased to 47.9 and 52.5, both surpassing estimates. December retail sales rose 1.3% y/y but fell 1.6% m/m, missing consensus forecasts.
In Japan, the January Jibun Bank Manufacturing PMI decreased to 48.8, missing expectations. The January Jibun Bank Services PMI increased to 51.0, less than forecast. In China, the January Caixin Manufacturing and Services PMIs fell to 51.1 and 51.8, respectively—missing expectations.
The Week Ahead:
The US releases core consumer prices, industrial production and retail sales. The UK and the eurozone report Q4 2019 GDP readings, industrial production and trade data. Japan announces retail sales, while China releases consumer prices and loan growth data.
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.