Global equities declined during the week. With few macroeconomic datapoints released during the week, equity markets appeared to take their cue from the Treasury market, where futures indicated a shallower cutting cycle from the Federal Reserve than had been previously priced. The S&P 500 finished the week down -0.62% in Sterling terms, while the tech-dominated Nasdaq Composite rose 0.51% and the Dow Jones Industrial Average fell -2.33%.

One notable signal came from earnings season, with the biggest results of the week coming from the magnificent seven stock Tesla. The electric vehicle manufacturer’s shares jumped over 20%, driving the Nasdaq’s outperformance, as it posted better than expected quarterly earnings and projected strong sales growth in 2025. Conversely, another magnificent seven stock, Apple, pushed the market down, with its shares retreating as Wall Street downgraded projected sales of the iPhone 16.

Looking to Europe, the UK’s FTSE All Share index declined -1.33%, while the continental European index, the MSCI Europe ex UK, registered a fall of -0.96% in Sterling terms. European PMIs broadly beat expectations during the month, however they continued to paint a sluggish picture, with German and French manufacturing firmly in contraction territory. Japanese markets experienced another tumultuous week, with the Nikkei 225 index tumbling -3.97%, as investors looked ahead to the weekend’s snap election. The ruling coalition, widely expected to retain its majority, suffered a major setback as no party won enough seats to be given a clear mandate to lead. They now have 30 days to try to form a new coalition.

Bond yields rose during the week, with the 10-year Treasury yield up 16bps to 4.28%, reflecting the shallower cutting expectations. This was matched in the UK, where 10-year Gilt yields rose to 4.22%, up 15bps. Investment grade corporate spreads were broadly unchanged. In commodity markets, oil rallied 4.1%, with Brent now at $76.05 a barrel.

Week Ahead

Source: Refinitiv Workspace, 28/10/24

Past performance is not indicative of future performance.

The value of an investment may fall as well as rise. You may get back less than the amount invested.

The value of investments may fall as well as rise purely on account of exchange rate fluctuations.

Source: London Stock Exchange Group plc and its group undertakings (collectively, the “LSE Group”). © LSE Group 2024. FTSE Russell is a trading name of certain of the LSE Group companies. “FTSE Russell®” is a trade mark of the relevant LSE Group companies and is used by any other LSE Group company under license. All rights in the FTSE Russell indexes or data vest in the relevant LSE Group company which owns the index or the data. Neither LSE Group nor its licensors accept any liability for any errors or omissions in the indexes or data and no party may rely on any indexes or data contained in this communication. No further distribution of data from the LSE Group is permitted without the relevant LSE Group company's express written consent. The LSE Group
does not promote, sponsor or endorse the content of this communication.

© S&P Dow Jones LLC 2024. All rights reserved

Source: MSCI. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, endorsed, reviewed or produced by MSCI. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such.

The information contained does not constitute investment advice. It is not intended to state, indicate or imply that current or past results are indicative of future results or expectations.

Full advice should be taken to evaluate the risks, consequences and suitability of any prospective investment. Opinions provided are subject to change in the future as they may be influenced by changes in regulation or market conditions. Where the opinions of third parties are offered, these may not necessarily reflect those of Rowan Dartington.

Rowan Dartington is part of the St. James’s Place Wealth Management Group. Rowan Dartington & Co. Limited is a member firm of the London Stock Exchange and is authorised and regulated by the Financial Conduct Authority. Registered in England & Wales No. 02752304 at St. James’s Place House, 1 Tetbury Road, Cirencester, England, GL7 1FP, United Kingdom.

SJP Approved 28/10/2024