Weekly Wrap-Up

Last Week In Markets: Nov 26 - Nov 30, 2018

Fisher Investments recaps the biggest market, political and economic news from last week, including US GDP growth, eurozone money supply growth and Japan and China PMI data.

Global equities rose, rebounding from recent short-term negative market volatility. In the US, the second estimate of Q3 2018 GDP growth was unchanged at 3.5% q/q annualized. However, the revision showed businesses accumulated inventory at a faster pace and spent more on equipment than initially estimated. Those changes offset downward revisions to consumer spending and exports in the quarter. October data reported this week were mostly positive. For example, personal spending increased 0.6% m/m and wholesale inventories rose 0.7% m/m. However, October new home sales fell more than anticipated, decreasing 8.9% m/m. The decline follows a 5.5% m/m drop in September. While housing makes headlines, monthly new home sales tend to be volatile and aren’t a big economic driver—residential investment accounts for less than 4% of GDP. For more on the state of the current US housing market, please see our 7/2/2018 MarketMinder column, “US Housing Update.”

In the eurozone, data were mostly positive. October money supply (M3) grew 3.9% y/y, ahead of forecasts, accompanied by a 3.2% y/y increase in October loan growth. Preliminary November core consumer prices (excluding energy, food, alcohol and tobacco) rose 1.0% y/y. The October unemployment rate remained at 8.1% for the fourth consecutive month.”

In Japan, the November manufacturing flash Purchasing Managers’ Index (PMI) missed expectations at 51.8. (Measures above 50 indicate growth.) October retail sales surpassed consensus estimates at 3.5% y/y and core-core consumer prices (excluding food and energy) rose 0.4% y/y. October unemployment increased slightly to 2.4% while preliminary industrial production rose 4.2% y/y. In China, the official November manufacturing and non-manufacturing PMIs fell slightly to 50 and 53.4, respectively.

The Week Ahead:

US, eurozone and UK reports include final November Markit manufacturing and services PMI data. The eurozone and Japan release revised estimates of Q3 2018 GDP. China reports November trade 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 a Luxembourg tax basis. Past performance is no guarantee of future results. A risk of loss is involved with investments in stock markets.