Market Summary Week Ending 04/06/2023

Global Financial Markets were buoyed this week through the news of a US debt ceiling bill achieving bipartisan agreement from both Democrats and Republicans within the US Congress and Senate, in addition to an unexpectedly strong job markets report, which has helped ease investors’ worries about a potential recession in the US.

The Senate voted to approve a bill that raises the debt ceiling for two more years, sending the legislation to President Biden’s desk just days before the US had been at risk of not being able to pay its debts, after Treasury Secretary Janet Yellen warned that default could happen as early as today, Monday 5 June.

Meanwhile, the May jobs report released Friday showed the US economy remains robust with more than 390,000 roles created last month, against an estimate of just 190,000 and has helped ease investors’ fears about a potential recession looking forward.

US investors reacted positively to both pieces of news, across the trading week in the US, the S&P 500 and Nasdaq both gained about 1.8% and 2%, respectively. The Dow Jones Friday advance pushed it into positive territory for the week, finishing up 2%. For the Nasdaq, this was its sixth straight week of gains, a streak length not seen for the technology-heavy index since 2020.

In the UK, investors followed the optimism seen in the US through both the FTSE 100 & 250 indices reporting strong weekly gains of 1.23% and 1.89% respectively in a bounce back week after two consecutive weeks of losses.