Bassanese Bites: Lofty stocks – September 02 2024
Global markets
Global equities consolidated last week, following several weeks of strength in anticipation of US Fed rate cuts ahead. Helping in the consolidation was a less-than-usually impressive Nvidia earning update. That said, the S&P 500 still closed at a new end-week market high.
There was little more in the way of good news to drive markets last week following the euphoria around Fed chair’s Powell’s Jackson Hole speech.
Key news included a modest consumer led upgrade to Q2 US GDP growth (from 2.8% annualised to 3%) and still reassuringly low weekly jobless claims – both of which further reduced lingering fears the Fed may be “late to the party”, and a recession is around the corner. Expectations are firming for only a 0.25% US rate cut at the September 17-18 policy meeting.
The US July core PCE inflation report was again benign, with a 0.2% monthly gain in line with market expectations. Annual core inflation edged lower to 2.6% from 2.7%.
Other key global developments of note included Nvidia’s good but less than usually impressive earnings update, with the rate of expected annual revenue growth now decelerating from extremely lofty levels.
There was also a mini-spike in oil prices last week on news of potential supply disruptions in Libya – though prices were unwinding again by week’s end. Containing oil prices, moreover, are growing expectations that OPEC will lift oil production limits next month.
Global week ahead
Key highlights this week are US labour market data, including job openings on Wednesday……
