Weekly Performance
Dow +0.36% S&P +0.06% Nasdaq -0.33% Russell +1.33% Mexico +0.78% Brazil -0.48% Nikkei +2.47% Hang Seng +0.26% Shanghai -0.03% Shenzen +0.03% EuroStoxx +0.74% FTSE +1.32% CAC +1.29% Dax +0.59% Ibex -0.12% MIB +1.36% SMI +1.20%
Equities held steady this week as investors digested the latest FOMC policy directive, which was released on Wednesday afternoon. The major indices ticked up to new record highs in the first half of the week, but faltered a bit on the back nine. The S&P 500 ticked up 0.1% while the Dow (+0.4%) did a little better and the Nasdaq (-0.3%) did a little worse.
The Fed's latest policy directive came in pretty much as expected. The FOMC unanimously voted to leave the fed funds target range at 1.00%-1.25% and announced that it will start its balance sheet normalization process in October. Meanwhile, the Fed's so-called "dot plot" was unchanged from the one released in June, showing that the median FOMC member still anticipates an additional rate hike in 2017 and three rate hikes in 2018. Within the equity market, the heavily-weighted financial sector (+2.7%) finished near the top of the sector standings, benefiting from the prospect of heightened interest rates and some sector rotation. The financial group has trailed the broader market for much of the year, but has been making a come back over the last two weeks; the sector has added 6.9% since September 7.
The telecom services group (+3.8%) also put together a solid performance this week, trimming its year-to-date loss to 8.5%, amid reports that Sprint (S) and T-Mobile US (TMUS) are nearing a merger deal after more than four months of on-and-off talks. The two companies settled the week with gains of 10.8% and 4.7%, respectively. On the flip side, the top-weighted technology sector (-0.7%) underperformed, thanks in large part to Apple (AAPL), which dropped 5.0%. There were rumors of softer-than-expected demand for the new iPhone 8, which hit stores on Friday, but this week's slide was also likely due to some end-of-quarter profit taking following yet another solid three-month stretch for the company. AAPL shares will enter Monday's session with a quarter-to-date gain of 5.5% and a year-to-date gain of 31.1%. Countercyclical groups like health care (-1.2%), consumer staples (-2.3%), and utilities (2.8%) also struggled this week while cyclical groups like materials (+1.0%), industrials (+2.0%), and energy (+2.0%) finished with sizable gains. Meanwhile, the growth-sensitive consumer discretionary and real estate groups lost 0.1% and 2.8%, respectively.
Macro :
- German Election Result ‘Less Market-Friendly’ Than Expected: SEB
- Magnitude 3.4 Quake Detected Near North Korea Nuclear Test Site
- Trump Is Said to Get Tax Plan That Targets 20% Corporate Rate
- Iraq to Raise Oil Capacity to 5M B/D, Committed to Output Cuts
Keep an eye on :
- AB1 GY : Air Berlin Sale May Generate as Much as EU350 Million: Bild
- AB1 GY : Lufthansa to Offer EU200M for Air Berlin: Bild Am Sonntag
- AIR FP : Airbus May Sell Aerotec Unit Or Stake to Canada’s Onex : Welt
- ADEN VX : Adecco CEO Dehaze Sees Growth Opportunities With SMEs: FuW
- AZN LN : Bernstein say it could be a takeover candidate - FT article http://on.ft.com/2xvXKs8
- BPM PL : U.S. Funds Interested in Banco BPM EU2b NPL Portfolio: Sole
- CRG IM : Carige Is Said to Aim for Full Subordinated Debt Swap: Sole
- CLN VX : Clariant Won’t Adjust Exchange Ratio, Rolker Tells SamW, Postpones Shareholder Meeting for Merger: SZ
- DTE GY : Deutsche Telekom possible privatisation could fetch EUR 10bn for broadband investment - FAZ
- FB US : Facebook Abandons Plans to Change Share Structure, Avoiding Lawsuit - WSJ
- LCL LN : Ladbrokes Coral Is Said to Hire Merger Advisers: Sunday Times
- NAS NO : Monarch Airlines receives bid approach from Norwegian Air Shuttle - independent.ie
- NETS DC : Hellman & Friedman set for $5bn Nets A/S takeover - FT - http://on.ft.com/2ylOg0y
- SAP GY : SAP Agrees to Buy Gigya for Over $350M Cash, TheMarker Reports
- SIE GY : Siemens CEO Says Relationship With Russia Is Strained: Spiegel
- UHR VX : Swatch Group Sees Significant Growth Most Places: Hayek in SamW
- TKA GY : Thyssenkrupp Forms Working Group With Employee Reps on Merger
- TLW LN : Tullow to Keep TEN Field Oil Output 50,000 BOPD Until Year-End
- UBER IPO : Uber Regroups After London Taxi Setback as Lyft Signals Interest
- UBER IPO : EU Is Said to Seek More Protection for Uber-Style Jobs: Rtrs
- VOW3 GY : VW Agrees to Help German Dealers to Boost Diesel Sales: Spiegel