Global equity markets advanced despite volatility from U.S.–China trade headlines and a spike in oil prices following sanctions on Russia’s top oil firms. In the US, Small- and mid-caps outperformed large caps, with technology and energy sectors leading gains while utilities and consumer staples lagged. The ongoing government shutdown delayed several economic reports, but September inflation data was released late. Headline inflation rose slightly to 3.0%, just below expectations, while core inflation held steady at 3.0%. S&P Global’s preliminary PMI readings showed business activity strengthening in October. U.S. Treasury yields fluctuated: short-term (1–3 year) yields rose, while the 10-year yield declined. The pan-European STOXX Europe 600 Index ended 1.68% high. Eurozone purchasing managers’ surveys showed business activity hit a 17-month high in October, supported by the strongest increase in new orders in two-and-a-half years. Japan’s Nikkei 225 index rose sharply over the week (+3.6%) as markets welcomed the election of the Liberal Democratic Party’s (LDP) Sanae Takaichi as Japan’s prime minister. Mainland Chinese stock markets rose amid strength in technology-focused shares despite economic data highlighting weak domestic demand. Gold had its worst week since Nov 2024 (ending a 9 week win-streak). However, we do note that the yellow metal found support at $4100. The dollar was volatile while bitcoin rallied (although it remains well off its all-time highs).
Have a great weekend
Charles & the Syz Research Lab