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Gerald Fitzgerald’s Market Review October 8th

8th October 2018

 

LAST WEEK IN 30 SECONDS...

Global bond yields rose adding to further risk off sentiment. Coupled with this, economic data releases in particular that of US unemployment falling to near 50-year lows saw investors moving to take some heat out of their exposures. Global stock markets sold off with the NASDAQ and Eurofirst 300 down -3.2% and -1.7% respectively over the week.

Market scepticism that Italy’s budget proposal would lead to unstable debt levels continued, despite Italy’s finance minister, Giovanni Tria noting the country’s intention to target reducing its deficit levels from 2020. The potential risk of a ratings downgrade looms large with the Italian Banks Index falling a further -3.8% over the week, with the index now down -22.0% for the year-to-date.

Despite surviving a stabbing at a rally in September, the first-round victory in Brazil’s presidential election for right wing candidate Jair Bolsonaro is an ongoing nod to the global fatigue amongst voters for the established political elite. His often Trump like views have shaped an all too familiar pattern for modern elections.

 

THIS WEEK IN 30 SECONDS...

Brexit discussions continue this week with the political declaration document to put Brexit into effect due for publication on Wednesday – investors will watch closely on both the content and any delay in the publication as an indication of the progress being made.

US inflation metrics are due for publication on Thursday whilst elsewhere, the Q3 earnings season commences with a number of US companies due to publish their quarterly results.

 

ASTON MARTIN – SHAKEN, NOT STIRRING

The luxury car manufacturer Aston Martin sought to capitalise on its status and connections with the James Bond film franchise via an Initial Public Offering (IPO) last week. Its shares were met with particular disappointment with investors opting for the ejector seat, falling -4.7% on launch day and ending down -9.0% for the week.