Markets steady this week as strong UK data offsets mixed global sentiment
This week @ 1515 – Friday 16th January – London.
Markets:
- FTSE 100 rose 0.96% this week to 10,221.9, driven by strong performance in the defence sector, including Babcock International, which offset weakness in mining stocks.
- S&P 500 fell 0.17% this week to 6,950.79, driven by investor caution following US inflation data that showed headline CPI remains under scrutiny at 2.7%.
- Nasdaq Composite fell 0.51% this week to 23,546.79, driven by volatility in large-cap technology shares ahead of the upcoming quarterly earnings season.
- Euro Stoxx 50 rose 0.58% this week to 6,008.53, driven by a rotation into defensive sectors despite a softer opening on Friday.
Bonds:
- UK 10-year gilt yields rose 3 bps this week to 4.40%, reflecting resilient GDP growth and steady labour data.
- U.S. 10-year Treasury yields were flat this week at 4.19%, following balanced inflation data and shifting rate expectations.
Commodities:
- Brent crude rose 0.7% this week to $64.47, supported by geopolitical uncertainty in Venezuela and the Middle East.
- Gold rose 1.2% this week to $4,594, as central bank buying and safe-haven demand pushed prices toward record levels.
- Copper fell 1.3% this week to $5.80, driven by forecasts of a global supply surplus in the near term.
FX:
- GBP/USD was flat this week at 1.341, as the strength of the US dollar was balanced by positive domestic growth figures.
- EUR/GBP rose 0.2% this week to 0.868, reflecting marginal Euro strength against a stable Pound.
Macro:
- US headline CPI remained steady at 2.7% in December, meeting market expectations.
- UK November GDP grew by 0.1%, suggesting modest but stable economic momentum.
- Geopolitical focus shifted to diplomatic tensions between the US and Denmark regarding territorial interests in Greenland.
Companies:
- Babcock and Rheinmetall rose on increased defence demand.
- Rio Tinto saw gains following reports of potential merger activity and a copper supply deal with Amazon.
- ASML rose over the week following strong capital expenditure guidance from major chip manufacturers.
- HSBC fell slightly after announcing a strategic review of its Singapore insurance business
What we will be keeping an eye on next week…
w/c 19th January
- Key events include the World Economic Forum in Davos and the release of the US PCE price index.
- Microsoft and Alphabet are scheduled to report quarterly earnings.
- Further corporate earnings from major US and European firms are also expected.
Markets move constantly and the numbers in this update will change. This is a snapshot only, pulled together from a range of sources, and is meant as a quick guide rather than a precise record. It’s not investment advice and shouldn’t be used to make trading or investment decisions. If you need more accurate or specific data over a defined period, please get in touch with a member of the team who will be happy to help.
Important Information
This article is for information only and does not constitute advice or recommendation and you should not make any investment decisions based on it. The views and opinions of this article are those of Casterbridge at the time of writing and may change without notice. Any opinions should not be viewed as indicating any guarantee of return from investments managed by Casterbridge nor as advice of any nature. It is important to remember that past performance and the value of an investment, and any income from it, may go down as well as up and the investor may not get back the original amount invested.