• Equity Markets: Equity markets had a positive day yesterday with the S&P500 +0.58% and the Nasdaq +1.12%, as momentum following traders bought equities and AI enthusiasm persisted. Europe was +0.79%. In the US, seven sectors were in positive territory and 52% of stocks ended higher. IT and Industrials were best. Energy and Financials were weakest. Nvidia again led the market higher rising 4.13%. In Europe, ten of eleven sectors were in positive territory, with industrials and financials best, whilst IT and Real Estate were worst. BMW declined 8.25% following a cut to guidance on weak Chinese growth and the cost of tariffs.
• Macro: In Europe, this morning the September UK RICS House Price index was slightly better at -15% vs -18% expected. Germany’s trade balance in August was €17bn vs €15bn estimated, with both imports and exports falling MoM. In the US, MBA mortgages declined -4.7% compared to -12.7% in the previous week. Fed minutes showed debate over balance sheet run-offs and caution among members over rate cuts amid inflation worries. The ECB’s Escriva sees risks to the ECB’s inflation target being very much balanced, but still sees trade disruptions being inflationary, but the European economy is showing a great deal of resilience. The ECB’s Muller said that inflation is where they want it to be and the economy is still on a gradual path of growth. The BOE’s chief economist Pill said he sees a structural change in price and wage setting, that may have shifted inflation expectations. Economic releases today include Ireland’s final September CPI, and depending on the US Federal shutdown we may get Initial and Continuing Claims as well as Wholesale Inventories. From the Central Bankers, today’s speakers include the ECB’s Villeroy and Escriva as well as the publication of the ECB’s last meeting minutes. The BoE’s Mann will also be speaking. From the Fed we get Bowman, Barr, Kashkari and Powell.
• Stocks: LVMH (Overweight PT €630 10% upside): Update ahead of Q3 earnings next week and a revised higher price target, given expectations of improving tailwinds.
• Debt: European government bond markets continued to be dominated by political developments in France yesterday, with spreads tightening as the prospect of snap elections have diminished significantly in the short term, with Macron likely to appoint a left leaning PM by Friday evening

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Opportunities this week:

• Kerry Group (Overweight PT: €111.69 Upside 47%): Recap on Kerry Group Investor Day in Naas.
• CRH (Overweight PT: $102.80 Upside 15.8%): Recap on latest Investor Day and positive medium term outlook.
• Supermarket Income REIT (Overweight PT: 90P Upside 13.3%): Commentary on meeting with senior management team last week.