Fisher Investments recaps the biggest market, political and economic news from last week, including core consumer prices, industrial and manufacturing production figures and retail sales.
Global equities fell amid mixed economic reports. In the US, data were light. October retail sales rose 0.3% m/m, more than anticipated. October core consumer prices (ex-food and energy) rose 0.2% m/m, as expected. October industrial and manufacturing production fell 0.8% m/m and 0.6% m/m, respectively, both missing the consensus. September business inventories were flat m/m, lower than analyst expectations. Media heavily focused on the first two days of public hearings tied to the ongoing impeachment inquiry of President Trump. While some may fret over the possible effect on markets, this is a slow-moving process and it’s far too early to determine potential impact.
In the eurozone, the second preliminary reading of Q3 2019 GDP and core consumer prices both rose 1.1% y/y, in line with expectations. September industrial production rose 0.1% m/m, beating the consensus. In the UK, Q3 2019 GDP rose 1.0% y/y, as expected, improving from the previous quarter’s contraction and avoiding a technical recession. While weakness in manufacturing and Brexit uncertainty lingers, we see this report as a positive sign. Importantly, services activity—about 80% of the UK economy—rose 1.4% y/y. September manufacturing production fell 0.4%, greater than anticipated. October retail sales grew 3.1% y/y, in line with the previous reading but missing the consensus. October core consumer prices rose 1.7% y/y, as expected.
In Asia, data were light. Chinese October retail sales rose 7.2% y/y, less than anticipated. October industrial production rose 4.7% y/y, less than expected. Japanese Q3 2019 GDP rose 1.3% y/y, missing expectations. September retail sales rose 9.2% y/y, handily beating expectations. September industrial production rose 1.7% m/m, also more than anticipated.
The Week Ahead:
US releases include the Conference Board’s Leading Economic Index and Markit manufacturing, services and composite purchasing manager’s index (PMI) data for October. Eurozone data reports include November preliminary manufacturing, services and composite PMI figures. UK economic reports include November Markit/CIPS Manufacturing and Services PMI data. Japanese releases consist of October core consumer prices, October imports and exports, and preliminary November Markit/JMMA manufacturing PMI numbers.
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.