The biggest news have to be the continued cooling of US inflation. CPI increased 3% on year in June, fell 0.1% on month. The biggest driver was the decline in energy cost, while shelter continue to ease slowly, rising 5.2% on year. Although it continues to come down, it is still way above pre-COVID levels. …
Continue reading “Market Review for the week ending 12 July 2024”
US economy Soft patch growing. More evidence of late to suggest that the US economy is slowing. Jobless claims have risen. Unemployment rate inched higher even though job creation remains plentiful. Not the time to worry but investors need to watch that it does not deteriorate further. GDPNow indicator down sharply. PMI for both manufacturing …
Continue reading “Market Review for Week Ending 5 July 2024”
US stock markets continue to make record highs while market breadth is weakening. The tech sector leads the market, and it is not just the Magnificent 7, an equal weighted tech ETF is also making new highs. Non-tech and small caps are weak, which will need to be resolved in the coming months if the …
Continue reading “Market Review For Week Ending 14 June 2024”
US labour market: some initial signs of stress creeping up in jobless claims. The 4-week moving average is inching up, albeit very slowly. While not a concern currently, investors should watch it very carefully to get a sense of whether the labour market finally breaks down due to high interest rates. US home sales hit …
Continue reading “Market Review for Week Ending 24 May 2024”
US inflation continues its slow easing. Shelter inflation continues to show hope. Small business also less inclined to raise prices. US economic surprise index has moved to the downside. Bad news is good for stocks as inflation is easing, raising hopes for looser monetary policy. US stock market breadth is solid. More new highs than …
Continue reading “Market Review for the week ending 17 May 2024”
US recession chatter is louder: Weaker ISM reports for both manufacturing and services, and a soft labour market report has prompted more recession calls. Investors ought to remember that recessions are caused by 1) a monetary-tightening-induced financial crisis turns into a credit crunch; 2) a geopolitical crisis causes oil prices to soar; or 3) speculative …
Continue reading “Market Review for the Week Ending 11 May 2024”
US Earnings Update: As the first quarter earnings season progresses, S&P 500 companies are performing strongly against expectations. A higher percentage of these companies are reporting positive earnings surprises, and the magnitude of these surprises exceeds the 10-year average. Consequently, the S&P 500’s earnings for the first quarter have increased compared to both last week …
Continue reading “Market Summary for Week Ending 3 May 2024”
Key developments: China’s challenge: Industrial profits slump. The focus on hi-tech manufacturing is facing critical challenges already. As profitability slumps, it’s more challenging to sustain manufacturing activity in a market economy. However, the push to continue investment into manufacturing could see mis-allocation of capital, which is a long term negative. Tech earnings: Mixed results but …
Continue reading “Market Review for Week Ending 26 Apr 2024”
Markets reacted to the events in the Middle East, where Israel responded to Iran’s barrage of missiles and drones. A surgical strike without major damage reported by Iran and a lack of follow up by Iran would have settled any concerns of escalations in the oil producing region. Nonetheless, equity markets continued to fall, driven …
Continue reading “Market Review for Week Ending 19 April 2024”
Oil and gold prices heading higher. Is it a cause for concern? Two key commodities that are influenced by geopolitics have surged in recent weeks. West Texas crude is approaching $90/bbl while gold is hitting $2350. It should be noted that during this period, the US dollar index did not decline, indicating true strength in …
Continue reading “Market Review for week ending 5 April 2024”