Gerald Fitzgerald’s Market Review November 11th

LAST WEEK IN 30 SECONDS...

Last week saw global equity markets continuing to press ahead with investors firmly camped in risk-on territory. Expectations of a trade deal being signed between the US and China, along with selective supportive economic data provided investors with sufficient hope that markets will continue on their upward trend.

Gold sold off strongly over the week finishing down 3.0%, whilst 10-year US treasury yields rose by 0.2%. Meanwhile German 10-year bond yields climbed back to levels not seen since July with the 10-year yield standing at -0.27%.

With some assistance from a weaker Euro, global equities finished the week 2.2% higher in euro terms.

THIS WEEK IN 30 SECONDS...

From an economic data perspective the week ahead sees Germany release its latest GDP figures on Thursday with expectations that the economy will fall into a technical recession. Elsewhere, Eurozone industrial production figures are due for release along with US inflation metrics on Wednesday.

From a corporate earnings perspective the week ahead sees further Q3 earnings disclosures with amongst others Tencent, Activation Blizzard and Foxconn announcing Q3 2019 results.

YIELD STARVED INVESTORS SEE GREECE LIGHTNING

Once seen by investors as practically untouchable with an accompanying yield of over 39%, Greek debt has since received significant support. The yield on BB rated Greek bonds has fallen significantly as investors stretch for returns, with yields on 10-year Greek bonds briefly falling below their higher BBB rated Italian counterparts last week for the first time since April 2008.