On Monday, the Dow Jones Index (US30) rose by 0.47%. The S&P 500 index (US500) gained 0.77%. The NASDAQ Technology Index (US100) closed positive 0.87%. The S&P 500 and Dow Jones Industrials indices hit new all-time highs, and the Nasdaq 100 Index hit a 2-month high. Optimism about corporate earnings for the third quarter helped boost stock prices after bank stocks rose last Friday on strong earnings results from JPMorgan Chase and Wells Fargo. According to data compiled by Bloomberg Intelligence, companies in the S&P 500, on average, are expected to report a 4.3% increase in quarterly earnings in Q3 from a year earlier, down from the 7.9% increase estimate in July. In addition, gains in chipmakers stocks on Monday helped boost the overall market.
Trading volumes were below average as trading in the Treasury cash market was closed due to the Columbus Day holiday. Fed comments signaled support for the gradual pace of interest rate cuts. Minneapolis Fed President Kashkari said a “further moderate reduction” in the federal funds rate would likely be appropriate in the coming quarters.
Mexico’s Consumer Confidence Index fell to 47.1 in September from 47.6 in August, the highest reading since February 2019. The decline reflects worsening sentiment about household finances and the country’s economic outlook, as well as a decrease in consumers’ willingness to make significant purchases. The minutes of the Bank of Mexico meeting emphasize the need for a less tight monetary policy in light of slowing economic growth and easing price pressures. The Central Bank is expected to cut rates by 50 basis points to 10% by the end of 2024.
Equity markets in Europe rose steadily on Monday. Germany’s DAX (DE40) rose by 0.69%, France’s CAC 40 (FR40) closed higher by 0.32%, Spain’s IBEX 35 (ES35) added 1.12%, and the UK’s FTSE 100 (UK100) closed up 0.47%.
The UK unemployment rate fell to 4.0% between June and August 2024, down from 4.1% in the previous three-month period and in line with market estimates. At the same time, the number of people in employment rose by 373,000 to 33.37 million, the highest on record, mainly due to growth in both full-time and part-time workers.
WTI crude oil prices fell by 2% to $74 a barrel on Monday amid concerns about China’s weakening economy. Markets were disappointed by China’s Finance Ministry briefing on Saturday, which lacked major new fiscal stimulus despite promises of support for the real estate sector and a potential increase in borrowing. China’s inflation also fell in September, raising concerns about weakening fuel demand in the world’s biggest oil importer.
Asian markets traded flat yesterday. Japan’s Nikkei 225 (JP225) was up 0.57%, China’s FTSE China A50 (CHA50) was up 1.66%, Hong Kong’s Hang Seng (HK50) was 0.75% cheaper, and Australia’s ASX 200 (AU200) was positive 0.47%.
India’s annual inflation rate for September 2024 rose to 5.49% from 3.65% in the previous month, well above market estimates of 5%. It was the highest inflation rate since the beginning of the year, surpassing the RBI’s 4% target after falling below the threshold in the first two months of the September quarter, jeopardizing earlier expectations of the Central Bank soon starting to cut rates.
S&P 500 (US500) 5,859.85 +44.82 (+0.77%)
Dow Jones (US30) 43,065.22 +201.36 (+0.47%)
DAX (DE40) 19,508.29 +134.46 (+0.69%)
FTSE 100 (UK100) 8,292.66 +39.01 (+0.47%)
USD Index 103.20 +0.31 (+0.30%)
