Market Overview
The FTSE/JSE All Share closed last week at 86 332.44, decreasing by 1.36%. The oil & gas and technology sectors were the biggest contributors gaining 3.52% and 2.65% during the week. The telecommunication and financials sectors were the biggest detractors losing 7.85% and 2.78% respectively over the same period.
Looking at the MSCI indices, developed markets decreased by 0.74% during the previous week, while emerging markets increased by 0.42% over the same period.
Euro inflation continues to decline
The annual inflation rate in the Eurozone fell to 1.8% in September 2024, the lowest since April 2021, compared to 2.2% in August and forecasts of 1.9%, preliminary estimates showed. Inflation is now below the ECB target of 2%. Meanwhile, the core inflation rate also the bloc’s largest economies, inflation slowed in Germany (1.8% vs 2%), France (1.5% vs 2.2%), Italy (0.8% vs 1.2%) and Spain (1.7% vs 2.4%). The ECB expects inflation to rise again in the latter part of 2024, partly because previous sharp falls in energy prices will drop out of the annual rates. Inflation should then decline towards 2% over the second half of 2025.
US GDP growth remains solid
The US economy grew at an annualized rate of 3% in the second quarter of 2024, unchanged from the second estimate and above an upwardly revised 1.6% expansion in the first quarter. There were upward revisions to private inventory investment, federal government spending and imports. On the other hand, consumer spending grew slightly less than seen in the second estimate. The US economy grew 1.6% in Q1 2024, higher than 1.4% initially reported. In 2023, GDP growth was revised up to 2.9% from 2.5%, and for 2022, the GDP expanded 2.5%, 0.6% stronger than previously estimated.
US job data surprises
The US economy added 254 000 jobs in September 2024, much higher than an upwardly revised 159 000 in August, and well above forecasts of 140 000. It is the strongest job growth in six months and higher than the average monthly gain of 203 000 over the prior 12 months. Their unemployment rate fell to 4.1% in September, the lowest in three months, down from 4.2% in the previous month. The data has casted doubt on any additional sizable declines in rates from the Fed after the initial 0.5% reduction in September.
Thanks to PPS Investments for the weekly Market Overview.
Financial Indicators 7 October 2024 by Sharedata.co.za
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