Weekly Wrap-Up

Last Week In Markets: Jan 8 - Jan 12, 2018

Fisher Investments recaps the biggest market, political and economic news from last week, including US inflation data, eurozone industrial production figures and German coalition talks.

Global stocks finished higher.

In the US, economic data were light but mostly positive. November business inventories increased 0.4% m/m, ahead of forecasts. The Core Consumer Price Index (excluding food and energy) rose 1.8% y/y in December, slightly higher than expected while retail sales rose 5.6% y/y.

In Europe, November eurozone industrial production increased 3.2% y/y, in line with forecasts. Eurozone retail sales beat expectations rising 2.8% y/y in November while the unemployment rate fell to 8.7%—its lowest level since January 2009. In German politics, the Christian Democratic Union (CDU) and Social Democratic Party (SPD) announced a tentative framework for a potential coalition. However, the deal must be approved at an SPD party conference later this month for negotiations to proceed. Germany has been without a ruling government since September’s federal elections and, despite media arguing political uncertainty hurts economic growth, German GDP grew at a respectable 2.2% pace in 2017. Additionally, regardless of the government's final makeup, the likelihood of radical legislation seems low—a positive for stocks. In the UK, November industrial and manufacturing production increased 2.5% y/y and 3.5% y/y, respectively—both higher than expected.

In Asia, economic data were also light. Chinese consumer prices rose 1.8% y/y in December, slightly below expectations. December import and export values increased 4.5% y/y and 10.9% y/y respectively. In Japan, December bank lending increased 2.5% y/y.

The Week Ahead:

The US releases December manufacturing and industrial production figures. The eurozone posts trade and inflation data. In Asia, China releases December industrial production, retail sales and Q4 2017 GDP. Japan reports December industrial production.

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.