Global equities markets were modestly higher on the week with the S&P 500 setting a new intraday record on Friday morning in a week dominated by politics. President Joe Biden’s uneven debate performance left him sinking in the polls, whilst France’s far-right National Rally party made further gains. 

US markets posted modest gains in a relatively quiet week in terms of macroeconomic data. The core personal consumption expenditures (PCE) price index rose just 0.1% month-on-month in May. PCE is a key inflation measure for the Federal Reserve. Year-on-year, the index is up 2.6% which is 20 basis points lower than April’s rate.  Investors also received the third and final reading of Q1 US gross domestic product (GDP) on Thursday, revised up 10 basis points to an 1.4% annualised rate despite a notably weaker personal consumption component than previously thought. The yield on US 10-year treasuries was unmoved at 4.26%.

In Europe, The German DAX 30 closed the week modestly higher, whilst the French CAC 40 slumped to a -1.96% loss in local currency. France’s right-wing National Rally party is now expected to receive the most votes in Sunday’s first round of French parliamentary elections, however exactly how that may translate into seat composition remains to be seen. With a UK general election this coming Thursday, both the large-cap FTSE 100 and the mid-cap FTSE 250 also succumbed to modest losses of -0.89% and -0.76%, respectively. 

Elsewhere, the yen fell to its lowest level against the US Dollar since 1986 this week, prompting suggestions further intervention from Japan’s Ministry of Finance may be required, having done so only two months ago. The USD/JPY exchange rate rose as high as 161.27 on Friday morning. The minutes of the June Bank of Japan meeting released this week suggest that a rate hike could come as soon as the central bank’s next meeting on 31 July. 

In commodities, the price of a barrel of West Texas intermediate crude oil closed the week marginally higher at $81.49. The price of copper meanwhile continued to slip on weaker Chinese sentiment, giving back some of its year-to-date gains.

Week Ahead

Source: Refinitiv Workspace, 01/07/24

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 01/07/2024