Global equity markets rose. Portfolios underperformed as our overweights to Europe and Technology detracted from relative returns.
US data were light, but positive. The second estimate of Q3 2017 GDP was revised up to 3.3% annualized from 3.0%. The November ISM manufacturing Purchasing Managers’ Index (PMI) fell to 58.2, but remained in expansion. October new home sales increased 6.2% y/y. October personal consumption rose 0.3% m/m. As of this writing, the Senate is scheduled to vote on its version of a tax reform bill. If the bill passes, a joint Congressional committee will try to reconcile differences between the House and Senate bills and create a final version. If it makes it that far, this legislative process likely plays out over time and under plenty of media scrutiny—enabling markets to mute any surprise power.
In the eurozone, the November Markit manufacturing PMI rose to 60.1. Eurozone October loan growth increased 2.7% y/y and October money supply (M3) grew 5.0% y/y. The October eurozone unemployment rate fell from 8.9% to 8.8%. In the UK, November CIPS manufacturing PMI beat expectations at 58.2.
In China, the official November manufacturing and non-manufacturing PMIs rose to 51.8 and 54.8, respectively. In Japan, October industrial production rose 0.5% m/m and retail sales contracted 0.2% y/y, both below expectations. The November manufacturing PMI met expectations at 53.6. October core-core inflation (excluding fresh food and energy) rose 0.2% y/y and the October unemployment rate remained at 2.8%.
The US releases November ISM non-manufacturing PMI and unemployment data. The eurozone reports October retail sales, November Markit services PMI and the third estimate of Q3 2017 GDP. The UK posts October industrial production. China releases November inflation data and Japan reports its second estimate of Q3 2017 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.