Weekly Wrap-Up

Last Week In Markets: May 4 - May 8, 2018

Fisher Investments recaps the biggest market, political and economic news from last week, including US inflation data, UK industrial and manufacturing production and Chinese trade data.

Global stocks ended the week 2.1% higher. US economic data releases were light. April consumer prices increased 2.5% y/y, in line with expectations, while core consumer prices (excluding food and energy) rose 2.1% y/y—lower than estimates. Many investors worry inflation could continue rising and potentially endanger the current economic expansion. To read our updated views on inflation, see our 5/7/2018 MarketMinder commentary, “Inflation, Globally Speaking.” On Tuesday, President Trump announced the US will withdraw from the Joint Comprehensive Plan of Action, commonly known as the Iran nuclear deal and reinstitute economic sanctions against Iran.

European economic data were mixed. In the UK, March industrial production rose 0.1% m/m and manufacturing production fell 0.1% m/m, however, both grew 2.9% y/y. March export and import values rose 3.5% y/y and 1.7% y/y, respectively. The Bank of England left monetary policy unchanged, as expected. Germany’s March industrial output rose 1.0% m/m and 3.2% y/y, bouncing back from February’s decline that some fretted as a sign of peaking eurozone growth. Additionally, German March exports grew 1.7% m/m after contracting in February.

In Asia, China's April consumer prices rose 1.8% y/y. April import and export values rose 21.5% y/y and 12.9% y/y, respectively. Total yuan loan growth was 12.7% y/y in April, meeting expectations. In Japan, bank lending increased 2.1% y/y in April.

The Week Ahead:

The US reports April retail sales and Leading Economic Indicators. The eurozone posts April industrial production and inflation, March trade data and the second estimate of Q1 2018 GDP. China announces April retail sales, industrial production and trade data. Japan releases April retail sales and inflation, March industrial production and the first estimate of Q1 2018 GDP.

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.