Written by Anthony Walters – Clever‘s Head of ESG & Christos Chountoulesis our Investment Analyst, the Market Review is packed with the most interesting and impactful events of the past week from the global financial markets.
Market Recap.
Despite mixed economic and monetary policy signals, major markets rose last week with the S&P 500 ETF (1.76%), Nasdaq 100 ETF (1.68%), Dow Jones Industrial Average ETF (1.26%) followed by the FTSE 100 ETF (1.19%).
News.
U.S. Commerce Secretary Gina Raimondo visits China from Sunday to shore up ties between two global superpowers that are increasingly drifting apart economically and looking to ship and source goods closer to home. The two biggest economies in the world used to be each other’s largest trade partners, but Washington is now trading more with neighbouring Canada and Mexico, while Beijing is trading more with Southeast Asia.
Geopolitics.
The BRICS bloc of developing nations agreed to admit Saudi Arabia, Iran, Ethiopia, Egypt, Argentina and the United Arab Emirates in a move aimed at accelerating its push to reshuffle world order. This was the first expansion of the bloc’s in 13 years and BRICS leaders left the door open to future enlargement as dozens more countries voiced interest in joining a group they hope can level the global playing field.
Inflation.
British consumers’ mood perked up this month as lower inflation made individuals less downbeat about the outlook for their personal finances, a survey showed on Friday. The GfK consumer sentiment indicator rose to -25 in August from a three-month low of -30 in July, its biggest rise since April although still below the average of -10 for the survey, which has been running since 1974.
Central Banks.
Federal Reserve Chair, Jay Powell, took a hawkish tone in his speech at Jackson Hole, noting that while inflation has tumbled in recent months, it isn’t yet at an acceptable level. Officials at the central bank are prepared to do whatever it takes to bring the rate down to the 2% target, he said. “Although inflation has moved down from its peak—a welcome development—it remains too high, Powell said Friday.
Commodities.
It was a ‘sweet week’ for commodities as Sugar added 9.15%. The crop continues to trade near the highest level for a decade on global supply shortages and India restricting its export quota. Silver moved higher by 6.72% whilst Gold only gained 1.80%. Elsewhere, Coal rebounded by 5.67% although it’s still down by nearly 60% for the year.
ESG.
Sustainable mining tech company Ceibo has raised more than $30 million through a Series B round, with proceeds aimed at accelerating its leaching process to extract copper more economically and sustainably. Copper is one of the key materials needed to support the transition to a low-carbon economy, with demand expected to rise over the next several years as energy, transport and industrial systems shift heavily towards electrification.
Week Ahead.
On Tuesday, the US reports Conference Board Consumer Confidence with the prior reading of 117 overshooting estimates of 111 as consumer confidence continues to grow. Wednesday sees the US report GDP figures with Quarter-on-Quarter growth expected to increase to 2.40% from 2.00% prior.
The EU publishes its CPI inflation figures on Thursday, which are widely expected to fall from 5.30% to 5.10%.
Sources.
Anthony Walters – Head of ESG at Clever Adviser Technology Ltd (Clever)
Market recap Data sourced from FE FundInfo & Koyfin. ETFs quoted: iShares Core FTSE 100 UCITS ETF, iShares Core S&P 500 UCITS ETF, iShares Nasdaq 100 UCITS ETF (quoted in Pounds Sterling).
News U.S., China set for talks as they bring trade closer to shores, by Joe Cash and Kripa Jayaram, Reuters, 25/08/23
Inflation Lower inflation boosts UK consumer mood: GfK, By David Milliken, 25/08/23
Central Banks Jackson Hole News: Powell Sounds a Hawkish Tone, Barrons, 28/08/23
ESG Sustainable Mining Solutions Company Ceibo Raises $30 Million, by Mark Segal, ESG Today, 18/08/23
Geopolitics BRICS welcomes new members in push to reshuffle world order by Carien du Plessis, Anait Miridzhanian and Bhargav Acharya, 25/08/23
Commodities Data sourced from Koyfin and Investing.com
Week ahead Data sourced from Investing.com
Risk Warning: These are Anthony’s views at the time of writing and should not be construed as investment advice. The opinions expressed are correct at time of writing and may be subject to change. Capital is at risk. The value and income from investments can go down as well as up and are not guaranteed. An investor may get back significantly less than they invest. Past performance is not a reliable indicator of current or future performance and should not be the sole factor considered when selecting funds.
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