Last Week In Markets: Jan 16 - Jan 20 2023

In the US, December retail sales decreased 1.1% m/m, but rose 6.0% y/y. December industrial production decreased 0.7% m/m and increased 1.6% y/y. December manufacturing production declined 1.3% m/m and 0.5% y/y.

In the eurozone, December headline consumer prices increased 9.2% y/y—slowing from November’s 10.1% y/y and October’s 10.6% y/y readings. December core consumer prices (excluding energy, food, alcohol & tobacco) rose 5.2% y/y, in line with expectations. In the UK, headline consumer prices rose 10.5% y/y—in line with forecasts. December core consumer prices (excluding food and energy) increased 6.3% y/y, slightly more than expected. Retail sales fell 1.0% m/m and 5.8% y/y in December, more than expected.

In Japan, December headline and core-core consumer prices (excluding fresh food and energy) increased 4.0% y/y and 3.0% y/y, respectively. November retail sales fell 1.3% m/m but rose 2.5% y/y. November industrial production rose 0.2% m/m, but fell 0.9% y/y. December imports and exports rose 20.6% y/y and 11.5% y/y, respectively. The Bank of Japan left monetary policy unchanged with short-term interest rates at -0.1%. In China, December retail sales fell 1.8% y/y—better than forecast. December industrial production rose 1.3% y/y, higher than expected. The unemployment rate declined to 5.5% in December. Q4 2022 GDP increased 2.9% y/y—beating expectations. In our view, sentiment towards China remains stubbornly low—but it seems to us that China is already exceeding this low bar. As the world gradually realizes this, falling uncertainty should be a nice tailwind. For more, please see our 1/17/2023 commentary, “The China Tailwind in 2023.”

The Week Ahead:

The US, eurozone and UK report flash January S&P Global Manufacturing and Services Purchasing Managers’ Indexes (PMIs). Japan releases the flash January Jibun Bank Manufacturing PMI. The US reports December preliminary durable goods orders and the first estimate of Q4 2022 GDP. The eurozone releases December money supply growth (M3). Japan releases December 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 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.