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Market Insights

Market Insights - Week 43

Anupam Kumar

Global markets showed rebound and optimism last week amid volatility. September’s CPI report, strong jobs report and softer tone by some policymakers provided fresh impetus to the market last week. However, for a sustainable rebound and growth, global markets need to witness moderating inflation and fall as well as stabilization in treasury yields.

Let us highlight some of the significant movements of the last week:

  • The S&P 500 index witnessed best weekly gain in nearly 4 months and closed at 3752.75 with weekly increase of 169.68 points i.e., a handsome growth of 4.7%.
  • Dow Jones Industrial Average index and NASDAQ grew 4.9% and 5.2% respectively over the week.
  • Resilient oil prices fell only 0.5% to close at USD 85.16 bbl despite the announcement of oil release from the U.S. strategic Petroleum Reserve.
  • On Friday Morning, the benchmark US 10-year Treasury yield touched 14-yr high at 4.33%.
  • On the resignation of UK PM Liz Truss, share market in Europe rose fueled by scrapping of her liberal fiscal policies.
  • The Stoxx Europe 600 index grew 1.27% and France’s CAC 40 index gained 1.74% over the week.
  • Italy’s FTSE MIB advanced 3.04% and on the other hand, Germany’s DAX and the UK’s FTSE 100 index climbed 2.36% and 1.62% respectively.
  • Japan’s market ended the choppy week of trading lower as Nikkei 225 fell 0.7% and the broader TOPIX index slid 0.8%.
  • With the delay in releasing of China’s key economic data without any explanation, China’s stock market recoded weekly loss where the broad, capitalization-weighted Shanghai Composite index slipped 1.1% and the blue-chip CSI 300, which tracks the largest listed companies in Shenzhen and Shanghai, eased 2.6%.

As per the latest reports, coming from global markets, softer commodity prices, improved supply chains and moderating shipping costs are some of the major factors which are reducing pressure on prices across a range of goods and it’s contributing significantly in the slowdown of core goods inflation. We continue to believe that the Fed would increase the interest rate in the last 2 months of the year by 0.75% and 0.5% respectively. However, with more positive news and data coming in, it would slow down in the year 2023.

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Anupam Kumar

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