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Over the weekend US President Joe Biden and House Speaker Kevin McCarthy agreed a deal in principle on the debt-ceiling. It now needs to pass in the House and Senate. The US Dollar index is holding above 104 today (Tuesday), its highest level since mid-March.
Stock-markets in Asia and Europe were generally lower last week. US stocks were pretty much flat except the technology sector which showed a strong out-performance.
US inflation data came in above expectations last week…
Full report:
Market Review from Realm Investment Management – week ending 19th May 2023
Stock-markets rose last week on positive corporate results and hopes that the US debt ceiling issue will be resolved over the next few days. In the longer-term there is also increasing optimism that the Fed will start cutting rates later in the year. The German DAX index was the stand-out performer last week, reaching an all-time-high.
Re the debt-ceiling countdown: a meeting on Friday night brought no agreement from negotiators but today (Monday) President Biden is due to meet Republican Kevin McCarthy in a further attempt to resolve the issue.
Full report:
Debt ceiling drama still to play out
Disclaimer: ‘Where the business has expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. The information contained within this communication is believed to be reliable but Realm Investment Management Limited does not warrant its completeness or accuracy.
This communication is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell investments.’
Market review – week ending 12th May 2023
Stocks were generally flat to slightly lower last week.
Inflation has been the main focus for investors for months but there was encouraging data last week. In the US, the rate of annual inflation fell to 4.9% in April; below 5% for the first time in two years and may give the Fed room to pause rate hikes next month. That’s the market implied expectation and looking further out, rate cuts are anticipated before the end of the year – this in contrast to what the Fed seems to be thinking…
Full report
https://realmim.com/market-focus-shifting-from-inflation-to-debt-ceiling/
Disclaimer: ‘Where the business has expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. The information contained within this communication is believed to be reliable but Realm Investment Management Limited does not warrant its completeness or accuracy.
This communication is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell investments.’
Weekly market summary – w/e 5th May
US stocks bounced back strongly on Friday to recover the majority of the decline earlier in the week. The week started on a down note with bank concerns continuing to weigh. US regulators had stepped in on Monday to seize First Republic Bank, later announcing that JP Morgan Chase had taken over the failed bank.
On Wednesday, the Federal Reserve announced a further 0.25% rate hike in line with market expectations. A possible pause in the tightening cycle was also signalled by the removal from the central bank’s statement, of the phrase “additional policy firming may be appropriate” – this had previously been included. However…
Disclaimer: ‘Where the business has expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. The information contained within this communication is believed to be reliable but Realm Investment Management Limited does not warrant its completeness or accuracy.
This communication is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell investments.’
…that’s the consensus view
US GDP slowed to 1.1% in Q1 2023. The US economy is slowing, down from 2.6% Q4 2022. The consensus is for a recession (albeit a mild one) at some point this year.
Illustrating the challenge that the Fed faces in it’s fight with inflation, the PCE Price Index came in at 4.6%, month-on-month, exceeding forecasts. The US central bank is widely expected to hike rates another 0.25% this week. The ECB will also announce this week, and the Bank of England next week. Small hikes are expected from both.
Full report
https://realmim.com/small-hikes-now-and-a-mild-us-recession-to-come/
Disclaimer: ‘Where the business has expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. The information contained within this communication is believed to be reliable but Realm Investment Management Limited does not warrant its completeness or accuracy.
This communication is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell investments.’
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