Fisher Investments recaps the biggest market, political and economic news from last week, including the US Leading Economic Index (LEI), eurozone trade data and Chinese GDP growth.
Global markets rose 0.3% amid Brexit developments and a slew of Chinese economic releases. In the US, data were light. The September Conference Board’s Leading Economic Index (LEI) fell 0.1% m/m, below forecasts. September retail sales rose 4.1% y/y, more than expected. September industrial and manufacturing production decreased 0.1% y/y and 0.9% y/y, respectively.
In the eurozone, September core consumer prices (excluding food and energy) rose 1.0% y/y, as expected. August industrial production grew 0.4% m/m but fell 2.8% y/y. August imports increased 4.6% y/y while exports fell 2.2% y/y. In the UK, September retail sales rose 3.1% y/y. September core consumer prices climbed 1.7% y/y, in line with the consensus. On Thursday, EU and UK negotiators announced they reached a new Brexit agreement and EU nations voted to endorse the new deal. However, it will also need to pass an upcoming vote in UK Parliament over the weekend, where its outcome is uncertain. Our view remains unchanged: While some Brexit outcomes may lead to short-term market volatility, any resolution—whether that be a deal or no deal scenario—would give businesses and markets much needed clarity. For more, please see our 10/18/2019 commentary, “Today in Brexit, Day 1,210.”
In Asia, Japanese August retail sales rose 4.6% m/m. August industrial production fell 4.7% y/y, as expected. September core-core consumer prices (excluding food and energy) rose 0.5% y/y. Chinese Q3 2019 GDP rose 6.0% y/y, slightly less than forecasted. September outstanding loans grew 12.5% y/y and industrial production rose 5.8% y/y, both beating estimates. September imports and exports fell 8.5% y/y and 3.2% y/y, respectively—both missing expectations. September retail sales rose 7.8% y/y, as expected. September consumer prices rose 3.0% y/y, slightly more than estimates.
The Week Ahead:
The US and eurozone announce October Purchasing Managers’ Index (PMI) data. Japan releases September trade data, October manufacturing and services PMIs, and the final reading of its August Leading Economic Index. The European Central Bank meets to set monetary policy.
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.