ATTIVO
Market Summary Week Ending 15/01/2023
UK Markets saw positive news this week from both domestic and international sources through better-than-expected levels of economic growth with news that Gross Domestic Product (GDP) grew 0.1% between October and November last year; this was against economists’ forecasts where many were predicting a contraction of around 0.2% for the same period. The main reasons for the increase were through the services sector, boosted through the winter FIFA World Cup.
Additional optimism came from the US during the week with further positive inflation news (more details within the US segment below) boosting investor optimism that central banks will slow interest rate increases, due to signs that inflation is potentially cooling across the major economies. This led to optimism for US investors that inflation has reached its peak with hope that the Consumer Price Index (CPI) will continue to decrease over the coming months.
As a result of this increased optimism, across the trading week, the FTSE 100 was up around 1.88%, continuing a buoyant start to 2023, where the index is up around 5% for the month to date so far.
In the US, as stated above, figures released on Thursday showed the CPI for the 12-month period up to the end of December was 6.5%, down from 7.1% as reported for the 12 month period up to December 2022.
This inflation data will factor heavily into the Federal Reserve’s next monetary policy meeting, which takes place at the end of the month (January 31st) with many US analysts predicting a lower increase of 0.25% in comparison to the 0.50%/0.75% rises that were seen all across 2022.
Further boosts were seen from the financial sector, as the earnings season for US companies based upon financial data from Q4 2022 began on Friday, with JPMorgan Chase and Bank of America Corporation both beating earning expectations, leading to an increase of 1.6% for the trading day on Friday.
As a result, The S&P 500 and Nasdaq each had consecutive positive weeks and the best weekly performance since November. The tech-heavy Nasdaq was the outperformer for the week after rising 4.82%. The S&P 500 advanced 2.67%, and the Dow Jones added 2%.
Looking forward to the week ahead for the UK, CPI figures will be released on Wednesday (18th) with optimism that similar to the US, Inflation has further decreased from the 10.7% figure released in December.
Please note for this weekly summary, we focus on the major indices within the financial markets such as the FTSE 100 (UK) and the Dow Jones and NASDAQ (US) to provide a factual account of what has happened within a certain index. Performance figures quoted are factual from the previous week’s trading and this summary is for commentary purposes only.
The performance of these indices is not a representation of an individual fund or portfolio. Past performance is no guarantee of future returns. The value of your investment can go down as well as up. You could get back less than you originally invested.