The latest Weekly Market Views from our managed portfolio service team covers market moves, the latest data releases and what to watch.
For information purposes only. The views and opinions expressed here are those of the author at the time of writing and can change; they may not represent the views of Premier Miton and should not be taken as statements of fact, nor should they be relied upon for making investment decisions.
In brief
- An antitrust investigation sparks share price falls for Nvidia.
- US employment data consistent with slowing demand to support rate cuts.
‘Rock ‘n’ roll star’
Oasis fans may ‘Look back in anger’ at the dynamic pricing approach used for their forthcoming tour, resulting in the online ticket agency falling under a competition investigation. ‘Half the world away’ a similar dynamic befell US tech company Nvidia, which for the last couple of years had a share price that was ‘supersonic’ in leading the US market higher. Nvidia is now subject to a US anti-trust investigation which ‘Some might say’ was inevitable given their dominance in artificial computing. Despite the stock seeing some sharp falls, US investors will be hoping that the stock will ‘Cast no shadow’ on the rest of the US market.
‘All around the World’ investors are more alert to US labour data and what this may say for the growth outlook. On Wednesday nerves were tested when US job opening figures fell below consensus to the lowest level since the end of 2020. ‘A quick peep’ at the FED Beige Book (report of the economy from the Fed’s regional branches), however, signalled the softer data emerging is consistent with a slowing economy, rather than anything more severe.
After the political fracturing of the French elections in July, the leader of the Social Democratic Party and Chancellor of Germany Olaf Scholz must be wondering ‘Where did it all go wrong?’ after big gains for the far-right party at regional elections on Sunday. With German elections next year, there’s potential for more political instability in Europe. We remain somewhat neutral to Europe for now.
Officials in China were left ‘Waiting for the rapture’ as 4.7% GDP growth underwhelmed forecasters and undershot the official 5% target. With faster manufacturing output offset by slower services expansion, the gloomy response continued to justify our emerging market cuts last month.
Oil has been ‘Falling down’ with World Texas Intermediate crude touching $70. Demand fears and Libya restarting production pushed the black gold lower. However, this lower cost acts as a self-correcting mechanism for global growth, so we take a more sanguine view of this price move than commentators.
‘Lord don’t slow me down’
The market was tested by Friday’s non-farm payrolls and unemployment report. It was hoped the figures would ‘Turn up the sun’ with an increase of 165k, according to Bloomberg reports. If not, recession fears could resurface once more. The actual figure was 142k. More recent optimism and eye-watering valuations may ‘Slide away’ to spur a pick-up in equity turbulence. Investors should not panic but review ‘The masterplan’ they have in place with financial advisers. History has shown ‘The importance of being idle’ regarding market volatility. The ability to ‘Acquiesce’ short-term swings of the market and either ‘Soldier on’ or ‘Roll with it’ has previously shown to be the most rewarding outcome.
Finally, recent spending decisions have thrust Labour’s first Budget in October into the spotlight. We’ve all been assured that it will not solely be about ‘Cigarettes and alcohol’ this time, with fiscal discipline being sought by the UK market (which we favour for cheap valuations). This is in contrast to the ‘Truss episode’ two years ago.
