ATTIVO
Market Summary Week Ending 19/02/2023
On Wednesday (15th February), UK CPI data showed that inflation continues to decrease, dropping from 10.5% in December 2022 to 10.1% in January 2023, with the biggest reduction in prices seen within the transport and hospitality sectors.
This continued decline is likely to have an impact on the decision made by the Bank of England about interest rates at their next Monetary Policy Committee meeting in March, with many analysts speculating that this continued decline in CPI will lead to lower rate hikes of 0.25% instead of the 0.50% rises we have seen over the past two meetings.
Following this announcement, the FTSE 100 continued its strong performance for 2023 finishing with an overall 1.55% gain for the week – and also broke the 8,000.00-point barrier for the first time in the index’s history.
In the US, CPI figures were also released (on Tuesday 14th) showing that inflation had also decreased, with a figure of 6.40% for the year up to January, a small decrease from December’s figure of 6.50%. This decrease was lower than analysts expected, leading to concerns from investors about how the economy and equities will hold up. The Federal Reserve is expected to continue to hike rates to tame stubbornly high inflation, with Federal Reserve Governor Michelle Bowman stating that there is a ‘’long way to go before the central bank reaches its target of 2% inflation’’.
Across the trading week there were mixed fortunes for the three major indices. The Dow Jones ended down 0.13% for the week, its third negative week in a row – a first since September 2021. The S&P 500 also declined 0.28% for the week, its second negative week in a row. The Nasdaq was the only positive performer with an increase of 0.59% over the trading week. This continues the strong start to 2023 for the tech-focused indices, which has seen it gain over 13% year to date.
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.