Weekly Market Wrap 12/02/24

Markets ended the week higher as China announced a significant stimulus package and the S&P Index breached the psychologically significant 5,000 level for the first time driven by the relentless advance of the magnificent seven. 

UK Market   

The UK market ended the week lower. Unemployment was re-weighted at 3.9% for November vs. previously reported 4.2% and PMI come in at 54.3, significantly higher than initially estimated at 53.8 and a strong indication for an expansion in business activity. 

US Markets 

The S&P 500 ended the week 1.37% higher, whilst the NASDAQ ended the week up 1.81%. The S&P Index breached the psychologically significant 5,000 level for the first time driven by the relentless advance of the magnificent seven. The Treasury’s record $42bn auction of 10-year notes was well received which was taken well by the broader markets in light of record US debt levels. 

European Markets  

The Euro Stoxx 50 ended the week 1.32% higher. Producer prices were down by 10.6% YoY in December, pulled lower by falling energy costs which fell by 2.3% MoM. Markets are currently pricing in an ECB rate cut for April 2024. Eurozone retail sales fell by more than expected MoM, dropping by 1.1% in December when a fall of 1.0% was forecast. The biggest falls were in seen in food, drink, and tobacco sales, which fell by 1.6% MoM.  

Commodities 

Brent crude rose by 6.28%, with prices rising after Israel rejected a ceasefire offer from Hamas, increasing concerns over broader conflict in the middle east that could disruption supply. 

Fixed Income 

Yields on US 10-year bonds rose to 4.19% ahead of the next US CPI release coming on Tuesday. CPI is expected to slow to 3.0% and core CPI is set to fall to 3.8%.   

The Week Ahead 

Monday –  

Tuesday – US CPI 

Wednesday – UK CPI & PPI 

Thursday – UK GDP & US Retail Sales 

Friday – US PPI & Consumer Sentiment   

*x% up/down to price as of last week’s close