Daily Digest: Tuesday 29th October
Equities
This week is fairly heavy in terms of both economic data prints and macroeconomic updates. The attention of European traders shifts to the UK as markets prepare for the Autumn budget, the first of Labour Chancellor Rachel Reeves. The red brief case will make its annual appearance tomorrow, October 30th. Fiscal spending changes will deepen the governments operating deficit, while the treasury attempt to regain revenue from a series of tax reforms targeting avoidance, capital gains, and inheritances. The budget should also shed some clarity on a series of ever present socio-economic issues including public sector pay disputes, the UK’s housing housing crisis and Labour’s plan for GDP growth. Despite experiencing a rebound in positive momentum on Monday London listed equities experienced relatively heavy sell-offs through the session. The UK’s benchmark index, the FTSE 100 (FTSE) traded 66.01 points (0.8%) lower to 8,219.61 signalling both a level of pessimism and uncertainty amongst investors heading into Wednesday. On the continent, the Pan-European STOXX 600 (STOXX) also experienced sell-offs, falling 2.96 points (0.57%) to 517.99.
US equities should remain unaffected by the UK’s budget announcements on Wednesday as traders are faced with the upcoming November presidential election as voting across the nation continues. A President Biden v President Trump rematch was expected to end in a landslide republican victory, however, the appointment of Kamala Harris as democrat nominee has drawn the contest far closer. Stock performances through Tuesday were mixed, the Nasdaq 100 ($NDX) led gains rising 199.58 points (0.98%) to 20,550.65 followed by the S&P 500 ($SPX) which rose 9.4 points (0.16%) to 5,832.92. The Dow ($INDU) was the only one of the three major indexes to close lower, having fallen 154.52 points (0.36%) to 42,233.05. On top of political pressures, markets also face US employment data prints as the first Friday of November approaches. Preliminary ADP NFP figures print on Wednesday and should be indicative of the general direction of final data, sparking the beginning of early movements across markets.
In Asia, trading on Japan’s Nikkei 225 (¥N225) remained steady, with positive sentiment reinforced as the index rose 298.15 points (0.77%) to 38,903.68, extending its five-session gains to 1.32%. In contrast, the situation for Chinese traders was bleaker, as the Shanghai Composite (¥SSE) fell 35.79 points (1.08%) to 3,286.41, erasing last week’s stronger performances.
What to Watch Tomorrow
Japanese Consumer Confidence
ADP Non-Farm Employment Figures
US Crude Oil Inventories
UK’s Autumn Budget
Statement of Chancellor Rachel Reeves
US Earnings:
Microsoft (MSFT)
Meta (META)
Eli Lilly and Company (LLY)
UBS (UBS)
Sources:
https://uk.finance.yahoo.com/world-indices/
https://uk.finance.yahoo.com/commodities
https://www.londonstockexchange.com/indices/ftse-100
https://www.binance.com/en-GB/price/bitcoin
https://www.binance.com/en-GB/price/ethereum
https://qontigo.com/index/sxxp/
Stock Market Activity Today & Latest Stock Market Trends | Nasdaq
https://coinmarketcap.com/charts/#market-cap
https://www.forexfactory.com
Definitions:
YoY - Year on Year, or, Year over Year
MoM - Month on Month, or, Month over Month
QoQ - Quarter on Quarter, or, Quarter over Quarter
ECB - European Central Bank
BOJ - Bank of Japan
Fed - Federal Reserve
BOE - Bank of England
SNB - Swiss National Bank
DOJ - Department of Justice