Weekly Wrap-Up

Last Week In Markets: Sept 24 - Sept 28, 2018

Fisher Investments recaps the biggest market, political and economic news from last week, including US GDP growth, eurozone money supply growth and Japanese unemployment.

Global equities fell 0.6% amid sparse economic news and a Federal Reserve rate hike. In the US, economic data were mostly positive. The third estimate of Q2 2018 GDP was left unrevised at 4.2% q/q annualized. August new home sales and durable goods orders increased 3.5% m/m and 4.5% m/m, respectively, both beating forecasts. However, August core capital goods orders unexpectedly contracted 0.5% m/m. The Federal Reserve raised its federal-funds rate by 0.25% (the eighth hike this cycle) and is now targeting a range of 2–2.25%.

In Europe, data releases were mixed. The UK’s third estimate of Q2 GDP was left unrevised at 0.4% q/q. Business investment fell 0.2% y/y. In the eurozone, August money supply (M3) rose 3.5% y/y, lower than forecast. However, August loan growth increased 3.1% y/y, beating expectations.

In Japan, August retail sales rose 2.7% y/y, beating forecasts. August preliminary industrial production rose 0.6% y/y, while the August unemployment rate fell to 2.4%. The Chinese government announced a tariff reduction scheduled to take effect in November, reducing their overall tariff rate to 7.5% from 9.8% last year. The rate cut would apply to machinery, paper, textiles and construction materials. However, the government did not detail how the general cut will apply to US goods subject to retaliatory tariffs.

The Week Ahead:

The US reports trade and employment data. The eurozone reports employment data and retail sales. The US, UK, eurozone, Japan and China release manufacturing and services Purchasing Managers’ Indexes (PMIs).

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.