Daily Digest: Friday 27th September
USA
The headline data event on Friday was the release of August’s core PCE, the Fed’s preferred inflation gauge. Naturally, the print holds a higher weight for traders in terms of monitoring and altering their interest rate predictions and inflation expectations. Personal consumption expenditure effectively tracks and quantifies the spending patterns of US consumers on a monthly basis, monitoring deviations in goods and services spending. In August, core PCE data came in 0.1 percentage points lower than analyst expectations (0.2%) at 0.1%. This indicates that prices within the PCE basket increased 0.1% during August, likely due to wider inflationary pressures or increased goods and services demand.
Once again, equities lacked any real direction. The S&P 500 ($SPX) headed lower, falling 7.2 points (0.13%) to 5,738.17, and the Nasdaq 100 ($NDX) dropped 106.91 points (0.53%) to 20,008.62. Meanwhile, the Dow ($INDU) rose 137.89 points (0.33%) higher to 42,313.
Europe
Once again, European trading was primarily influenced to foreign economic data releases, as the week was relatively slow in terms of domestic news. The UK’s FTSE 100 (FTSE) continued higher, rising 35.85 points (0.43%) to 8,320.76, taking the week’s gains to 90.77 points or 1.1%. Relative to Pan-European equity performances, gains in London were somewhat sluggish as the STOXX 600 (STOXX) rose 13.59 points (2.64%) during the same period.
Rest of the World
Tokyo area CPI for September came in in-line with analyst expectations of 2%, failing to shock traders domestically. As a leading indicator, the print suggests that national inflation within Japan may now be trending at the BOJ’s target level. The Nikkei 225 (¥N225) trended higher, rising 903.93 points (2.32%) to 39,829.56.
In China, traders continued to price in the potential impact of a second round of economic stimulus. The move will involve an expansion of Chinese sovereign debt issuance aimed at stimulating spending, alongside provisions to cover deficits of local governments tackling economic hardship. As expected, market sentiment remained positive, and the Shanghai Composite Index (¥SSE) extended gains, rising 86.58 points (2.88%) to 3,087.53. The index has now gained slightly above 352 points this week, a rise of around 12.87%.
Sources:
https://uk.finance.yahoo.com/world-indices/
https://uk.finance.yahoo.com/commodities
https://www.londonstockexchange.com/indices/ftse-100
https://www.binance.com/en-GB/price/bitcoin
https://www.binance.com/en-GB/price/ethereum
https://qontigo.com/index/sxxp/
Stock Market Activity Today & Latest Stock Market Trends | Nasdaq
https://coinmarketcap.com/charts/#market-cap
https://www.forexfactory.com
Definitions:
YoY - Year on Year, or, Year over Year
MoM - Month on Month, or, Month over Month
QoQ - Quarter on Quarter, or, Quarter over Quarter
ECB - European Central Bank
BOJ - Bank of Japan
Fed - Federal Reserve
BOE - Bank of England
SNB - Swiss National Bank
DOJ - Department of Justice