- Equity Markets: Global equities had a difficult day yesterday as investor worries over valuations eclipsed macro data showing positive signs of growth in the US. The S&P500 fell -0.5%, the Nasdaq also fell -0.5% whilst European stocks dropped -0.66%. In the US, two of eleven sectors were positive with 23.7% of companies higher on the day. Energy (+0.87%) and Information Technology (+0.03%) were the strongest. Health Care (-1.67%) and Consumer Discretionary (-1.47%) were the weakest. Intel had another strong day (+8.9%) after the market reacted positively to news that the company had approached Apple for investment and TSMC for potential manufacturing partnerships. TikTok’s US division is also set to be sold to US investors, at a potential value of $14bn. In Europe, three of eleven sectors were positive with 26% of stocks higher on the day. Energy (+0.40%) and Utilities (+0.23%) were the strongest. Health Care (-1.85%) and Real Estate (-1.11%) were the weakest. H&M, the fashion retailer was the best performing company on the day with the stock up +9.8% after quarterly margins and profits vastly exceeded street expectations.
- Macro: In macro news yesterday, in the US initial jobless claims for the week ended 20th September came in better than expected at 218k (est. 233k) as did Durable goods orders for August, up 2.9% MoM (est. -0.3%). Annualised quarterly GDP also came in stronger than expected at 3.8% (est. 3.3%). Wholesale inventories decreased by -0.2% (est. 0.1%) for August. In macro news today in the US, the University of Michigan Consumer Sentiment Index for September (final) will be released with the index expected to stay flat MoM at 55.4. The most important print of the day will be the release of the August Headline and Core PCE Price Index. It is estimated that inflation will rise to an annualised rate of 2.7% from 2.6% in July. From central bank speakers today, we have the Fed’s Barkin and Bowman, whilst the ECB’s Cipollone and Escriva will also be speaking.
- Stocks: Ryanair: (Overweight. €29.50: 25% upside): Ryanair issued a number of corporate announcements yesterday.PTSB: (Overweight. €2.60: 15% upside): PTSB announced changes to its mortgage and deposit rates. Novo Nordisk: (Overweight. DKK489: 35% upside): Details on its US investments after President Trump’s 100% pharma tariff last night.GSK: (Overweight. 1660p: 13% upside): Details on its US investments after President Trump’s 100% pharma tariff last night.
- Debt: Some weakness yesterday in bonds as US Q2 GDP was revised higher to 3.8% largely reflecting a 0.9pp upward revision to consumption growth to +2.5%
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