Stock Markets

The major indexes ended lower this past week as rising bond yields attracted investors’ attention. The 30-stock Dow Jones Industrial Average (DJIA) lost 2.68% while the Total Stock Market Index fell by 1.15%. The broad S&P 500 Index lost 0.96% while the NYSE Composite Index gave up 2.16%. The only major index that managed to end in positive territory was the technology-heavy Nasdaq Stock Market Composite which advanced by 0.16% for the week. Investor risk perception, as indicated by the CBOE Volatility Index (VIX), was elevated by 12.76%.

After posting gains in each of the six previous weeks, the S&P 500 corrected this week. The stock market appeared to take cues from the U.S. Treasury market, where the futures market pricing currently reflects a shallower Fed rate-cutting cycle. Growth stocks outperformed value stocks as evidenced by the slight gain in the technology-heavy Nasdaq Composite Index. Tesla was the best performer in the S&P 500, posting unexpectedly strong quarterly earnings and projecting 20% to 30% vehicle sales growth in 2025. The electric vehicle manufacturer experienced its best gain (22%) in more than 11 years, driven by good quarterly results and a bright outlook.

U.S. Economy

The Fed’s Beige Book, which is released eight times a year and provides a summary of economic conditions in each Fed region, was issued in a relatively light week of economic news. This latest release reported little economic growth across most of the U.S., tepidly stating that the demand for workers “eased somewhat” while “inflation continued to moderate.” The Book’s assessment of the economic developments did not have a noticeable effect in stopping the increase in longer-term Treasury yields that began in late September. The market’s expectations for Fed rate cuts have steadily declined, now reaching a total of 125 basis points of easing in the next 12 months on Friday.

Metals and Mining

The spot prices of precious metals ended positive for the week. Gold closed at $2,747.56 per troy ounce, up by 0.96% from its close last week at $2,721.46. Silver ended at $33.72 per troy ounce, unchanged from its close last week. Platinum last traded this week at $1,025.29 per troy ounce, 0.98% higher than last week’s closing price of $1,015.31. Palladium closed this week at $1,196.50 per troy ounce, 10.37% more than its close one week ago at $1,084.09. The three-month LME prices of industrial minerals were mixed. Copper closed this week at $9,602.50 per metric ton, 0.24% below its previous weekly close of $9,625.50. Aluminum’s last trade was at $2,677.50 per metric ton, 2.51% higher than its last traded price one week ago at $2,612.00. Zinc ended this week at $3,102.00, 0.40% higher than its prior week’s close at $3,089.50. Tin ended this week at $31,325.00 per metric ton, 0.04% higher than its last weekly close at $31,313.00.

Energy and Oil

The Israel-Iran conflict just advanced into its next phase with the retaliatory missile attack overnight that Israel launched into Iranian territory. Its impact on the main oil market narrative for October is still to be seen. Added to that is the speculation regarding the results of the U.S. presidential election, which is just slightly more than a week away, and how it would impact future escalation scenarios. In the meantime, Brent and WTI are expected to post only minor week-over-week increases as they trend around $75 and $71 per barrel respectively. The upside is limited by a stronger dollar and a larger-than-expected U.S. inventory spike. In other industry news, the top executives of Enterprise Products and Plains All American announced that they would not be building any new crude oil pipeline out of the Permian shale play. They believe that the next step for crude evacuation capacity would be optimization,

Natural Gas

For the report week from Wednesday, October 16 to Wednesday, October 23, 2024, the Henry Hub spot price declined by $0.30 from $2.21 per million British thermal units (MMBtu) to $1.91/MMBtu. Regarding Henry Hub futures, the price of the November 2024 NYMEX contract decreased by $0.03, from $2.367/MMBtu at the start of the report week to $2.342/MMBtu at the week’s end. The price of the 12-month strip averaging November 2024 through October 2025 futures contracts rose by $0.03 to $2.971/MMBtu. Regional natural gas spot prices fell at most major pricing locations this report week. Price changes ranged from a decrease of $1.17 at PG&E Citygate to an increase of $0.11 at the Houston Ship Channel.

International natural gas futures price changes were mixed this report week. The weekly average front-month futures prices for liquefied natural gas (LNG) cargoes in East Asia increased by $0.28 to a weekly average of $13.45/MMBtu. Natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands, Europe’s most liquid natural gas market, decreased by $0.04 to a weekly average of $12.75/MMBtu. In the week last year that corresponds to this report week (beginning October 18 and ending October 25, 2023), the prices were $18.21/MMBtu in East Asia and $15.65/MMBtu at the TTF.

World Markets

European stocks modestly declined on expectations that the Federal Reserve may ease monetary policy more gradually than expected. The pan-European STOXX Europe 600 Index ended 1.18% lower in local currency terms. The major European stock indexes also lost ground. France’s CAC 40 Index lost by 1.52%, Italy’s FTSE MIB slid by 1.22%, and Germany’s DAX dipped by 0.99%. The UK’s FTSE 100 Index gave back 1.31%. Business activity continued to contract in the euro area in October as new orders continued to dwindle, according to S&P Global. The composite Purchasing Managers’ Index (PMI), which combines activity in the manufacturing and services sectors, is estimated to register 49.7 in October compared to its September estimate of 49.6. While it is a slight improvement, the PMI readings below 50 indicate contraction, and failure of the PMI reading to break above 50 signals a failure to attain expansion. The main sources of weakness were France and Germany, the two largest economies. Several European Central Bank (ECB) policymakers, including those formerly in favor of aggressive policies, broached the likelihood of more policy easing this year, although there is some disagreement regarding the pace at which rate cuts should be applied.

Japanese equities lost traction over the week amid uncertainty over the outcome of the country’s general election on Sunday, October 27.  The Nikkei 225 Index gave up 2.74% while the broader TOPIX Index fell by 2.63%. The yen weakened to the high end of the JPY 151 range against the greenback, from JPY 149.5 at the end of the preceding week, mainly due to the heightened investor caution ahead of the elections. The yen also succumbed to some pressure from a strengthening dollar as investors discounted the prospect that the Federal Reserve was less likely to aggressively reduce interest rates. The Tokyo-area core consumer price index (CPI) rose by 1.8% year-on-year in October. This CPI is a leading indicator of nationwide inflation, and it rose slightly more than expected but slowing from the September 2.0% level. The slowdown was attributed to the reinstatement of electricity and gas subsidies. Bank of Japan (BoJ) Governor Kazuo Ueda urged the need to proceed cautiously due to the huge uncertainty and to avoid entertaining expectations that interest rates are going to stay low for a very long time.

Chinese stocks rose for the week as the central bank implemented more stimulus measures to support the economy. The Shanghai Composite Index gained by 1.17% while the blue-chip CSI 300 advanced by 0.79%. The Hong Kong benchmark Hang Seng Index fell by 1.03%. In line with a broad stimulus package unveiled by the People’s Bank of China (PBOC) in late September aimed at reviving China’s economy, Chinese banks lowered their one- and five-year loan prime rates by 25 basis points to 3.1% and 3.6% respectively to make it cheaper for consumers to take out mortgages and other loans. The PBOC also signaled additional easing measures in the short term. Depending on liquidity conditions, it made possible that another potential rate cut to the reserve requirement ratio may be taken. The central bank last cut the reserve requirement ratio by 50 basis points on September 27. The Chinese youth unemployment rate, for 16- to 24-year-olds, excluding students, eased to 17.6% in September from a record high of 18.8% in August. The August unemployment rate marked the highest level of youth unemployment since the statistics bureau stopped including students in the metric in December 2023.

The Week Ahead

Included among the economic releases scheduled for this week are the PCE inflation data, the third quarter GDP, and the nonfarm payrolls report for October.

Key Topics to Watch

• S&P Case-Shiller home price index (20 cities) for Sep.
• Consumer confidence for Oct.
• Job openings for Sept.
• ADP employment for Oct.
• GDP for Q3
• Advanced U.S. trade balance in goods for Sept.
• Advanced retail inventories for Sept.
• Advanced wholesale inventories for Sept.
• Pending home sales for Sept.
• Personal income for Oct.
• Personal spending for Oct.
• PCE index for Oct.
• PCE (year-over-year)
• Core PCE index for Oct.
• Core PCE (year-over-year)
• Initial jobless claims for Oct. 26
• U.S. employment cost index for Q3
• Chicago PMI for Oct.
• U.S. employment report for Oct.
• U.S. unemployment rate for Oct.
• U.S. hourly wages for Oct.
• Hourly wages year over year
• S&P final U.S. manufacturing PMI for Oct.
• Construction spending for Sept.
• ISM manufacturing for Oct.
• Auto sales for Oct.

Markets Index Wrap-Up

Stock Markets

All of the major stock market indexes scored gains week-on-week as risk perception dropped. The 30-stock Dow Jones Industrial Average (DJIA) added 0.96% over the week which mirrored the performance of the Total Stock Market Index which likewise rose by 0.96%. The broad S&P 500 Index climbed by 0.85% with the Small Cap 600, Mid Cap 400, and Super Composite 1500 all sowing more than 1% gains. The technology-heavy Nasdaq Stock Market Composite advanced by 0.80% while the NYSE Composite climbed by 0.88%. The investor risk perception indicator, the CBOE Volatility Index (VIX) fell by 11.88%.

The utilities and real estate sectors fueled the advancement of the S&P 500 Index. Energy stocks tracked the pullback of oil prices that weakened as anticipation of possible Israeli attacks on Iran’s oil and gas infrastructure abated. Down the market cap spectrum, returns were stronger as evidenced by the outperforming of the small-cap Russell 2000 Index and the S&P MidCap 400 Index.

The Nasdaq Composite rallied during Friday’s trading session after lagging for much of the week. The buying interest was buoyed by strong quarterly earnings reports from Taiwan Semiconductor Manufacturing, a company that operates foundries that make advanced digital semiconductors. Excitement was reignited for artificial intelligence (AI)-related stocks in the Nasdaq. Other companies reported surprise results on the upside and spurred the technology-heavy index. An example is Netflix which grew its subscriber number and expanded its operating margins by more than expected in the third quarter.

U.S. Economy

The value of U.S. retail sales increased by 0.4% last month, accelerating from the 0.1% August reading, which is an encouraging sign for third-quarter economic growth. The September uptick of 0.4% was slightly higher than the consensus forecast of 0.3%. Strength in consumer spending was broad-based, as 10 of the 13 retailer categories reported higher sales for the month. A measure of retail sales that excluded auto dealerships, building materials, food services, and gas stations exhibited the fastest growth rate in three months, expanding by 0.7% from the preceding month. Industrial production fell by 0.3% in September after increasing by 0.3% in August. The final statistic for August was revised downward from an initial estimate of 0.8%. The weakness was attributed by the Federal Reserve to Hurricanes Francene and Helene together with a Boeing aircraft machinist strike.

In the first week of October, new applications for unemployment benefits spiked. This was partly brought about by the damage and disruptions caused by Hurricane Helene in late September across several Southeastern States. During the week ended October 12, however, initial jobless claims fell unexpectedly to 241,000, constituting a decline of about 19,000 filings. The number of people receiving jobless benefit for more than one week rose by 9,000 to 1.867 million, which is short of the consensus estimate of 1.876 million.

Metals and Mining

Prices of gold and silver rallied above $2,700 and $33, respectively, in one of the quietest bull markets analysts have encountered. Because it was not clear to analysts who attended the London Bullion Market Association’s (LBMA) 2024 Precious Metals Conference in Florida who exactly was buying gold and silver at high prices, the sense of optimism brought about by the rally was not overly bullish. Analysts see gold prices rising to as high as $2,941 per ounce, but not quite above $3,000 per ounce before the end of 2024. But sentiments suggest that even at these record highs, there remains some potential upside. It is probably best that the advance is measured rather than euphoric, the latter usually accompanying a market peak. While the upcoming presidential election in the U.S. may mean that markets can peak at that point, the positive may not cool off immediately thereafter because whichever candidate wins, the geopolitical uncertainty is expected to remain elevated.

The spot price of precious metals recorded gains during the week. Gold, which ended last week at $2,656.59, closed this week at $2,721.46 per troy ounce for a gain of 2.44%. Silver began at the prior week’s close at $31.54 and ended this week at $33.72 per troy ounce to register an increase of 6.91%. Platinum came from $987.76 last week and closed this week at $1,015.31 per troy ounce for a gain of 2.79%. Palladium closed a week ago at $1,071.21 and this week at $1,084.09 per troy ounce to return 1.20% for the week. The three-month LME prices of industrial metals were mixed for the week. Copper lost by 1.00% for the week from its previous weekly close at $9,723.00 to close at $9,625.50 per metric ton. Aluminum ended one week ago at $2,586.00 and this week at $2,612.00 per metric ton for a gain of 1.01%. Zinc came from $3,086.50 one week ago to end this week at $3,089.50 per metric ton to realize a slight gain of 0.10%. Tin came from its prior closing price of $32,817.00 to end this week at $31,313.00 per metric ton for a decline of 4.58%.

Energy and Oil

As ICE Brent futures slid back to $79 per barrel, where it was last seen in early October, geopolitical risk premiums have slowly diminished from oil prices. Anticipation that Israel would launch retaliatory attacks against Iran sustained higher oil price levels, but coinciding with this wait was the slowdown of China’s economic growth to 4.6% in the third quarter of 2024. Furthermore, investors have been alerted to the downside of Chinese demand, the fifth consecutive month-over-month decline in Chinese refinery runs, which has deflated the bullish sentiment once more. In other news, the International Energy Agency (IEA) released a warning that world fossil fuel demand will hit its peak by the end of this decade. After it has done so, the surplus in fossil fuel supplies would enable it to spend more on renewables, which is seen as the start of the “age of electricity.”

Natural Gas

For the report week from Wednesday, October 9, to Wednesday, October 16, 2024, the Henry Hub spot price fell by $0.21 from $2.42 per million British thermal units (MMBtu) to $2.21/MMBtu. Concerning Henry Hub futures, the price of the November 2024 NYMEX contract decreased by $0.29, from $2.660/MMBtu at the start of the report week to $2.367/MMBtu by the week’s end. The price of the 12-month strip averaging November 2024 through October 2025 futures contracts fell by $0.19 to $2.945/MMBtu. At most major pricing locations, price changes ranged from a decrease of $0.70 at SoCal Citygate to an increase of $0.34 at the Waha Hub.

International natural gas futures prices climbed this report week. The weekly average front-month futures prices for liquefied natural gas (LNG) cargoes in East Asia advanced by $0.07 to a weekly average of $13.17/MMBtu. Natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands, the most liquid natural gas market in Europe, increased by $0.01 to a weekly average of $12.79/MMBtu. In the week last year that corresponded to this report week (the week beginning October 11 and ending October 18, 2023), the prices were $16.50/MMBtu in East Asia and $15.78/MMBtu at the TTF.

World Markets

The pan-European STOXX Europe 600 Index closed the week 0.58% higher in local currency terms as the markets were replete with expectations of a second consecutive interest rate cut by the European Central Bank (ECB) in furtherance of the easing of monetary policy. The major regional stock indexes advanced: France’s CAC 40 Index rose by 0.46%, Germany’s DAX gained 1.46%, and Italy’s FTSE MIB surged by 2.61%. The UK’s FTSE 100 Index added 1.27%. In line with expectations, the ECB cut its key deposit rate by a quarter of a percentage point to 3.25% in the first back-to-back rate reduction in 13 years. The disinflationary process was pronounced by ECB President Christine Lagarde to be “well on track” based on recent downside surprises in economic activity data. Financial markets appeared to expect the ECB to reduce rates in December to support the economy, although the ECB reiterated that it would not pre-commit to a particular rate path. According to the European Commission’s statistics office, the annual inflation came in at 1.7% in September. This is well below the ECB’s stated target of 2% and a downward revision from its initial estimate of 1.8%. The ECB does not expect the trend to be constant, however, as it forecasts that inflation will rise again before receding once more toward the 2% target next year.

Japan’s stock markets fell in local currency terms due to easing domestic inflation in September. While expected, this led to some speculation that the Bank of Japan (BoJ) may be less likely to raise interest rates again this year. The Nikkei 225 Index fell by 1.58% and the broader TOPIX lost 0.64%. BoJ officials observed that the prerequisite conditions for beginning monetary policy normalization have already been met, namely the breadth of items undergoing price increase as cited by BoJ Board Member Seiji Adachi. Nevertheless, rate hikes should be implemented at a very gradual pace. Adachi cautioned against a drastic change in policy given uncertainties surrounding the global economic outlook and domestic wage growth. The yield on the 10-year Japanese government bond rose to 0.97% from 0.94% at the end of the prior week. The yen weakened from the low to the high end of the JPY 149 range against the U.S. dollar. According to Japan’s top currency diplomat, Atsushi Mimura, recent moves in the yen were described as “somewhat one-sided and rapid.” The yen is once more trending towards levels where authorities intervened earlier in the year to stem the currency’s decline. Japan’s core consumer price index (CPI) indicated that inflation eased in September, although the country’s exports for that month declined from year-ago levels, the first decline in 10 months, due to weak Chinese demand.

China’s stocks rose in response to more support measures unveiled by the central bank after data indicated that deflationary pressures grew more entrenched in the economy. The Shanghai Composite Index advanced 1.36% in local currency terms while the blue-chip CSI 300 gained 0.98%. The Hong Kong benchmark Hang Seng Index fell by 2.11%. In the third quarter, China’s economy expanded by 4.6% year-on-year, exceeding consensus estimates. The growth rate was slightly lower than the second quarter expansion of 4.7% and continues to fall short of Beijing’s stated target of “around 5%.” The economy grew by 0.9% on a quarterly basis. Other economic data point to signs of improvement. In September, industrial production rose by a better-than-expected 5.4% from last year and up from 4.5% in August. Retail sales grew by 3.2% year-on-year which exceeded forecasts and further accelerated from the 2.1% growth recorded in August on the back of higher sales of household appliances, a major contributing factor. Annual inflation was at its lowest level in three months, registering 0.4% in September. This fell below consensus estimates and marked a slowdown from the August reading of 0.6%. Core inflation (excluding food and energy costs) increased by 0.1%, the lowest since February 2021. The producer price index dropped by a larger-than-expected 2.8% from last year, deepening from the 1.8% drop in August.

The Week Ahead

Included among the important economic reports scheduled for release this week are PMI data, new home sales, and final consumer sentiment for October.

Key Topics to Watch

• Dallas Fed President Lorie Logan speaks (Oct. 21)
• U.S. leading economic indicators for Sept.
• Kansas City Fed President Jeff Schmid speaks (Oct. 21)
• San Francisco Fed President Mary Daly speaks (Oct. 21)
• Philadelphia Fed President Patrick Harker speaks (Oct. 22)
• Fed Governor Michelle Bowman speaks (Oct. 23)
• Existing home sales for Sept.
• Fed Beige Book
• Initial jobless claims for Oct. 19
• Cleveland Fed President Beth Hammack opening remarks (Oct. 24)
• S&P flash U.S. services PMI for Oct.
• S&P flash U.S. manufacturing PMI for Oct.
• New home sales for Sept.
• Durable-goods orders for Sept.
• Durable-goods minus transportation for Sept.
• Consumer sentiment (final) for Oct.

Markets Index Wrap-Up

Stock Markets

The bull market continues as major indices rose through this week. The 30-stock Dow Jones Industrial Average (DJIA) added 1.21% while the Total Stock Market Index gained 1.17%. The broad S&P 500 likewise climbed by 1.11% and the technology-heavy Nasdaq Stock Market Composite rose by 1.13%. The NYSE Composite inched up by 0.88% and the Russell 1000, 2000, and 3,000 all ended higher for the week. The CBOE Volatility Index, the indicator of investor risk perception, rose by 6.51%.

This past week marks the two-year anniversary of the present bull market during which time stocks gained around 60%.  Historically, returns tend to moderate as bull markets make it to the end of the third year. This may likewise happen with this bull market since fundamental conditions remain strong but are tending to slow down. The Federal Reserve is expected to continue with its easing campaign even though September inflation came in slightly hotter than expected. It is more likely that quarter-point rate cuts will be decided on at each meeting until the Fed policy approaches 3% 5o 3.5%. However, earnings will have to push any future market gains since valuation have limited room to increase further. Signs of earnings broadening are expected to become evident as the third quarter season kicks off.

U.S. Economy

There has been several disappointing economic news over the weekend. The Labor Department reported on Thursday some modest some upside movements in headline and core (excluding food and energy) inflation which rose in September by 0.2% and 0.3% respectively, both slightly above expectations. Core prices rose by 3.3% year-over-year in September compared to 3.2% in August, the first increase since March 2023. Medical care (up 0.7%) and transportation (up 1.4%) services registered sharp increases in their seasonally-adjusted prices, which offset a 1.9% drop in energy prices.

The Labor Department also reported on Thursday a surprise jump in weekly jobless claims to its highest level in 14 months at 258,000. Partly to blame were disruptions by Hurricane Helene, however, Michigan also recorded substantial job losses. Continuing claims also rose to 1.86 million, their highest level since late July. This may have influenced the University of Michigan’s preliminary gauge of consumer sentiment in October which declined unexpectedly as respondents to the survey expressed greater caution about their personal finances.

The surprise increase in consumer inflation led to a significant change in expectations about the Fed’s next policy meeting in November. The futures market ended the week pricing in a respectable 14.1% likelihood that the Fed will hold rates steady. Minutes from the Fed’s October meeting, which were released on Wednesday, likewise revealed that some members favored on a 25-basis-point rate cut, compared to a 50-basis-point cut.

Metals and Mining

Gold’s price action continues to remain bullish despite being mostly ignored by generalist investors. Shallow corrections are consistently bought resulting in the yellow metal continuing to defy the odds. According to analysts, gold investors are justified in taking profits as expectations around the monetary policy actions of the Federal Reserve continue to vacillate. Last Friday, the market’s expectation of a 50-basis-point cut next month was dramatically doused by a stellar jobs report. This week, it was reported that consumer inflation rose more than expected as the core Consumer Price Index increased by 3.2% year-on-year, causing monetary policy doves to take another hit. Despite the hawkish news, analysts have noted that the gold market is delinking from single monetary policy decisions and growing much bigger. While a 50-basis-point but remains out of the question, it is evident the Fed will continue to ease interest rates even if the inflation rate remains high.

The spot prices of precious metals ended mixed week-on-week. Gold rose by 0.11% from last week’s close at $2,653.60 to this week’s close at $2,656.59 per troy ounce.  Silver ended 2.05% lower from its last traded price of $32.20 one week ago to its last traded price this week at $31.54 per troy ounce. Platinum lost 0.48% from its close last week at $992.55 to its close this week at $987.76 per troy ounce. Palladium surged by 5.73% from its ending price last week at $1,013.11 to its ending price this week at $1,071.21. The three-month LME prices of base metals have mostly come down. Copper, which closed last week at $9,866.00, ended this week at $9,723.00 per metric ton for a loss of 1.45%.  Aluminum, which ended at $2,629.00 the prior week, ended this week at $2,586.00 per metric ton for a decline of 1.64%.  Zinc settled this week at $3,086.50 per metric ton, 1.20% lower than last week’s closing price of $3,124.00. Tin closed this week at $32,817.00 per metric ton, 2.65% below last week’s close at $33,709.00.

Energy and Oil

Brent futures were nudged lower by some of the disappointment that an Israeli retaliatory strike on Iran, which the market anticipated all week, failed to materialize. Brent futures settled this week just below the $79-per-barrel mark. The oil-related impacts of Hurricane Milton were relatively minor despite the devastation the storm wreaked on Florida. Macroeconomics played a more robust role in influencing prices this week, particularly on the back of U.S. inflation dipping to an annual rate of 2.4%.  In other parts of the world, A UK oil major signaled a $500 million decline in refining margins and a weak performance from oil trading into its third-quarter earnings. Its rival company Shell quantified the decline in refining margins at 30% quarter-on-quarter, down to $5.5 per barrel compared to $7.7 per barrel in the second quarter.

Natural Gas

For the report week from Wednesday, October 2, to Wednesday, October 9, 2024, the Henry Hub spot price fell by $0.34, from $2.76 per million British thermal units (MMBtu) to $2.42/MMBtu. Regarding Henry Hub futures, the price of the November 2024 NYMEX contract decreased by $0.23, from $2.886/MMBtu at the start of the report week to $2.660/MMBtu by the week’s end. The price of the 12-month strip averaging November 2024 through October 2025 futures contracts declined by $0.12 to $3.130/MMBtu.

Concerning regional markets, natural gas spot price changes were mixed this report week. Prices rose in the Northeast but fell in most other major pricing locations. Price changes ranged from a decrease of $2.64 at the Wahu Hub to an increase of $0.48 at Algonquin Citygate.

International natural gas futures price changes were mixed this report week. The weekly average front-month futures prices for liquefied natural gas (LNG) cargoes in East Asia decreased by $0.06 to a weekly average of $13.10/MMBtu. Natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands increased by $0.20 to a weekly average of $12.78/MMBtu. In the week last year that corresponds to this report week (from October 4 to October 11, 2023) the prices were $14.18/MMBtu in East Asia and $13.28/MMBtu at the TTF.

World Markets

European equities were up, albeit modestly, for the week as the pan-European STOXX Europe 600 Index closed 0/66%. The market continued to hope that the European Central Bank (ECB) would proceed more quickly to cut interest rates and that China is set to enhance its economic stimulus, The major continental stock indexes were elevated as Italy’s FTSE MIB added 2.13%, Germany’s DAX rose by 1.32%, and France’s CAC 40 Index gained by 0.48%. However, the UK’s FTSE 100 Index lost by 0.33%. More ECB officials foresee that inflation may slow closer to the 2% target by the end of 2024, as indicated in the minutes from the September meeting. If incoming inflation data points align with the ECB’s projections, the central bank noted that a gradual reduction of borrowing costs would be appropriate. Nevertheless, policymakers refuse to commit to a particular rate path, although based on recent comments from ECB officials, they appeared to align with the market’s view that the pace of policy easing could quicken if inflation slows and the economy weakens.

Japanese stock indexes climbed over the week. The Nikkei 225 rose by 2.45% while the broader TOPIX Index gained by 0.45%, largely due to the weakness in the yen that provided a favorable profit outlook for Japanese exporters. The exchange rate floated close to its lowest level since August at about the high JPY 148 level against the US dollar. Earlier this month, the new prime minister, Shigeru Ishiba, brought the yen came under pressure when he cautioned that the environment is not ready for another interest rate hike. The 10-year Japanese government bond (JGB) yields rose in tandem with U.S. Treasury yields. Investors’ expectations around the likelihood of another aggressive (50-basis-point) rate cut by the Federal Reserve in November moderated. From 0.87% at the end of the prior week, the yield on the 10-year JGB rose to 0.94%.  Regarding its economy, Japan’s real wages (wages adjusted for inflation) fell by 0.6% year-on-year in August. The first decline in three months was brought about partly due to the diminishing impact of higher bonuses paid in the preceding two months. However, since the positive cycle wherein rising wages boost consumer spending has not yet come about, the sluggishness in the pay trend could lend some support to the view that the Bank of Japan (BoJ) may avoid raising interest rates again anytime soon. While the August household spending declined by 1.9% year-on-year, the drop was less than the consensus forecast of 2.6%.

During the holiday-shortened week, Chinese equities fell as optimism about the most recent stimulus measure faded. The Shanghai Composite Index lost by 3.56% and the blue-chip CSI 300 shed 3.25%. The Hong Kong benchmark Hang Seng Index gave up 6.53%. The markets in the mainland were closed on Monday for the National Day holiday that started on Tuesday, October 1.  At a press conference on Tuesday, the country’s economic planning agency, the National Development and Reform Commission, announced that China would speed up countercyclical measures to support growth. The announcement reiterated for the most part plans to boost investment and increase direct support to low-income groups and fresh graduates. Towards this end, the central government will continue ultra-long special bonds in 2025 for the purpose of funding major projects. Officials stated that Beijing will invest RMB 100 billion in strategic areas. In the meantime, over the long holiday that ended on Monday, spending by Chinese consumers failed to rise to pre-pandemic levels. Spending increased by 6.3% year-on-year while passenger traffic rose by 5.9%. Box office sales amounted to RMB 2.1 billion, lower than the RMB 2.7 billion reported last year. However, the average spending per trip was roughly RMB 131, which was higher than the RMB 113 recorded during the five-day Labor Day in May.

The Week Ahead

The CPI inflation data, import price index data, and an analysis of consumer sentiment are among the important economic releases this coming week.

Key Topics to Watch

• Columbus Day holiday. Bond market closed. (October 14)
• Federal Reserve Governor Christopher Waller speaks (October 14)
• Empire State manufacturing survey for Oct.
• Fed Governor Adriana Kugler speaks (October 15)
• Import price index for Sept.
• Import price index minus fuel for Sept.
• Initial jobless claims for Oct. 12
• S. retail sales for Sept.
• Retail sales minus autos for Sept.
• Industrial production for Sept.
• Capacity utilization for Sept.
• Business inventories for Aug.
• Home builder confidence index for Oct.
• Housing starts for Sept.
• Building permits for Sept.
• Federal Reserve Governor Christopher Waller speaks (October 18)

Markets Index Wrap-Up

Stock Markets

Most major stock indexes managed to rise modestly over the week. The 30-stock Dow Jones Industrial Average is slightly up by 0.09% while the Total Stock Market Index climbed by 0.19%. The broad S&P 500 inched up by 0.22% and the technology-tracking Nasdaq Stock Market composite climbed by 0.10%. The NYSE Composite advanced by 0.19%. The investor risk perception indicator, the CBOE Volatility Index (VIX) rose by 13.27%, suggesting that investors are wary that the market is facing greater volatility risk moving forward.

The stock market begins the fourth quarter on a volatile note after a strong performance during the first three quarters of the year. This is due in large part to elevated uncertainty in four major areas, namely the U.S. labor market, port strikes on the East Coast, tensions in the Middle East, and the approaching presidential elections in the U.S. Over the course of the week, however, the market found some relief in the tentative resolution of the port strike and the U.S. nonfarm jobs report that pleasantly exceeded expectations. The fundamentals of the economy remain solid despite the ongoing geopolitical uncertainties. Through 2025, the Federal Reserve is poised to lower interest rates, inflation continues to slow, and economic growth remains positive.

Moving forward, sources of volatility will continue to persist. The potential walkout by the International Longshoreman’s Association threatens to effectively close operations at every port in the East Gulf States, heightening fears of a new round of broken supply chains should the temporary agreement not be followed by a firmer resolution by mid-January. Furthermore, there are threats of a “more devastating attack” if Israel responds to the 200 missiles Iran fired directly at the central and southern parts of Israel this week, leading to an escalation in the war.

U.S. Economy

In its monthly nonfarm payrolls report, the Labor Department announced that 254,000 new jobs were added by employers in September, which is almost double the consensus estimates. The gains in August were further revised higher. The unemployment rate also inched lower to 4.1%, bringing better-than-expected news in the household survey. Investors appear wary about reacting to the data, however, the payrolls report, while generally upbeat, revealed another monthly decline in manufacturing jobs, the fifth such contraction in 2024. The Institute for Supply Management (ISM) reported on Monday that its gauge of factory activity remained unexpectedly steady at 47.2 in September (below 50 indicates contraction, and above 50 is expansion). On the contrary, it was reported on Wednesday that the ISM’s gauge of services sector activity jumped much higher than expected to 54.9, the highest level it has been in 19 months. On the negative side, the report likewise indicated that price pressures in the sector had increased, to their highest level since the start of 2024.

Metals and Mining

December gold futures ended trading on Friday at $2,665.70 per ounce, down by 0.5% for the day, and prices remained roughly unchanged for the week. According to analysts, despite the headwinds for precious metals, gold is holding up for one reason alone, and that is the risk of a weekend event in the Middle East. Investors do not want to head into the weekend without positioning in some form of insurance. Presently, gold remains the best safe-haven asset to own. A general backdrop of global uncertainty remains a major factor behind the unprecedented rally in precious metals this year, particularly gold, which, some analysts say, may push toward $3,000 per ounce before the year’s end should geopolitical tensions continue to rise.

The spot prices of precious metals ended mixed for the week. Gold closed at $2,653.60 per troy ounce for the week, slightly lower by 0.17% from last week’s close at $2,658.24. Silver ended this week at $32.20 per troy ounce, higher by 2.00% from last week’s price of $31.57. Platinum settled this week at $992.55 per troy ounce, lower by 1.12% than its close last week at $1,003.82. Palladium last traded this week at $1,013.11 per troy ounce, less by 0.30% than its close last week at $1,016.12.

The three-month LME prices of industrial metals were also mixed. Copper dipped by 1.17% from last week’s close at $9,982.50 to close this week at $9,866.00 per metric ton. Aluminum fell 0.66% from its closing price last week of $2,646.50 to close this week at $2,629.00 per metric ton. Zinc rose by 1.12% from last week’s close of $3,089.50 to end this week at $3,124.00 per metric ton. Tin ended higher by 2.42% from its closing price the previous week at $32,913.00 to close this week at $33,709.00 per metric ton.

Energy and Oil

After a protracted dispute over Libya’s Central Bank’s operations and staffing was resolved, the Benghazi government announced that it would reopen all oil fields and export terminals. Furthermore, gas production from Israel’s Leviathan and Tamar fields has restarted after a one-day shutdown caused by Iran’s large-scale missile attack which did not damage important installations. Against this backdrop, oil prices are set to post a $6 per barrel increase week-on-week as ICE Brent futures firmly settled themselves around $78 per barrel. Boosting the geopolitical risk premium are Iran’s missile barrage on Israel and the likelihood of retaliatory action from the Netanyahu government, The focus of the regional tension was such that the oil markets did not notice the lifting of Libya’s oil embargo which returned some 700,000 barrels per day (b/d) of crude oil to the market.

Natural Gas

For the report week covering Wednesday, September 25, to Wednesday, October 2, 2024, the Henry Hub spot price rose by $0.14 from $2.62 per million British thermal units (MMBtu) to $2.76/MMBtu. Concerning Henry Hub futures, the October 2024 NYMEX contract expired last Thursday at $2.585/MMBtu, down by $0.05 from the start of the report week. The November 2024 NYMEX contract price increased to $2.886/MMBtu, up by $0.07 from the start to the end of the report week. The price of the 12-month strip averaging November 2024 through October 2025 futures contracts climbed $0.05 to $3.246/MMBtu.

Regarding regional spot prices, natural gas prices rose at most locations. Price changes ranged from a decrease of $0.35 at the Algonquin Citygate in the Northeast to an increase of $1.44 at the Waha Hub.

International natural gas futures prices increased this report week. The weekly average front-month futures prices for liquefied natural gas (LNG) cargoes in East Asia increased by $0.13 to a weekly average of $13.16/MMBtu. Natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands increased by $1.04/MMBtu to a weekly average of $12.58/MMBtu. In the same week last year corresponding to this report week, (the week from September 27 to October 4, 2023), the prices were $14.44/MMBtu in East Asia and $12.11/MMBtu at the TTF.

World Markets

The escalation of conflicts in the Middle East made European investors cautious, causing the pan-European STOXX Europe 600 Index to fall by 1.80% in local currency terms for the week. Major stock indexes also took a nosedive with Italy’s FTSE MIB plummeting by 3.26%, France’s CAC 40 Index losing by 3.21%, and Germany’s DAX declining by 1.81%.  The UK’s FTSE 100 gave up 0.48%. As growth and inflation slow, the ECB’s rate cut is coming into view. The Purchasing Manager’s Indexes (PMIs) indicate a weaker eurozone growth and inflation fell below the 2% target of the European Central Bank (ECB). Both combined strengthened expectations that the central bank will cut interest rates later this month. In the eurozone, annual headline inflation slowed to 1.8% in September, which is the lowest reading since April 2021 and below forecasts for 1.9%. In August, core inflation likewise eased to 2.7% from 2.8%. For September, the eurozone composite PMI reading was revised higher to 49.6 from 48.9, thus moving closer to 50, the borderline when the PMI shifts from contraction to expansion.

Japan’s equities markets underwent a deep and sudden sell-off at the start of the week as investors came to terms with the country’s latest political developments. The Liberal Democratic Party’s (LDP’s) closely contested leadership election was won by Shigeru Ishiba (who was known to adopt a hawkish tone) on Friday, September 27. The surprise win over rival Sanae Takaichi in a runoff vote made Ishiba the new Prime Minister of Japan. The new prime minister’s known hawkish stance initially strengthened the yen and sent stock markets lower. Over the rest of the week, stock markets recovered some of their losses as Ishiba adopted a more dovish position than we have traditionally known to have. The result was a weakening of the yen to around JPY 146 against the USD from about JPY 142 at the end of the previous week. The Nikkei 225 Index and the broader TOPIX Index still registered losses of 3.0% and 1.7% respectively for the week. On the economic policy front, Ishiba committed to continue the path laid out by this predecessor, Fumio Kishida. He called for intensive efforts to overcome deflation without risking a reversal of the virtuous cycle. Ishiba admonished his cabinet to draw up a stimulus package to boost regional economies while simultaneously supporting households struggling with inflation.

In a holiday-shortened week of trading, Chinese stocks surged as optimism about Beijing’s comprehensive support measures offset the lackluster data. The Shanghai Composite Index rose by 8.06% and the blue-chip CSI 300 Index gained 8.48%. The Hong Kong benchmark Hang Seng Index ascended by 10.2%. The markets were closed on Tuesday for the National Day holiday and will reopen on Monday, October 7. Hong Kong markets were closed on Tuesday but reopened on Wednesday. For the fifth consecutive month, Chinese factory activity contracted amid weak demand. According to the country’s statistics office, the official manufacturing PMI climbed to an above-consensus 49.8 in September from 49.1 in August. It was an improvement but it remained below 50 and in contraction territory. For all but three months since April 2023, the manufacturing PMI has been in contraction. The non-manufacturing PMI, the measure of construction and services activity, dipped to a lower-than-expected 50 in September. This is its lowest level in 21 months. According to the China Real Estate Information Corporation, the value of the new home sales by China’s top 100 developers fell by 37.7% in September year-on-year, speeding up from August’s 26.8% drop.

The Week Ahead

The CPI and PPI inflation data and an analysis of consumer sentiment are among the important releases scheduled for the coming week.

Key Topics to Watch

• Fed Governor Michelle Bowman speaks (Oct. 7)
• Consumer credit for Sep.
• Louis Fed President Alberto Musalem speaks (Oct. 7)
• Fed Governor Adriana Kugler speaks in Europe (Oct. 8)
• NFIB optimism index for Sept.
• S. trade deficit for Aug.
• Atlanta Fed President Raphael Bostic speaks (Oct. 8)
• Federal Reserve Vice Chair Philip Jefferson speaks (Oct. 8)
• Atlanta Fed President Raphael Bostic gives welcoming remarks (Oct. 9)
• Dallas Fed President Lorie Logan speaks (Oct. 9)
• Wholesale inventories for Aug.
• Chicago Fed President Austan Goolsbee gives opening remarks (Oct. 9)
• Federal Reserve Vice Chair Philip Jefferson speaks (Oct. 9)
• Minutes of Fed’s September FOMC meeting (Oct. 9)
• San Francisco Fed President Mary Daly speaks (Oct. 9)
• Initial jobless claims for Oct. 5
• Consumer price index for Sept.
• Core CPI for Sept.
• CPI year over year
• Core CPI year over year
• Federal Reserve Governor Lisa Cook speaks (Oct, 10)
• Richmond Fed President Tom Barkin speaks (Oct. 10)
• New York Fed President John Williams speaks (Oct.10)
• Producer price index for Sept.
• Core PPI for Sept.
• PPI year over year
• Core PPI year over year
• Chicago Fed President Austan Goolsbee gives opening remarks (Oct. 11)
• Consumer sentiment (prelim) for Oct.
• Dallas Fed President Lorie Logan speaks (Oct. 11)
• Federal Reserve Governor Michelle Bowman speaks (Oct. 11)

Markets Index Wrap-Up

Stock Markets

Stocks hit new record highs this week on the back of optimism about the Federal Reserve’s recent rate cut, ongoing enthusiasm about AI, and new stimulus measures adopted by China that may spur hopes for a rebound in that country’s demand. All major stock market indexes were up week-on-week. The 30-stock Dow Jones Industrial Average (DJIA) inched up by 0.59%, mimicking the Total Stock Market Index’s 0.59% rise. The broad-based S&P 500 Index gained 0.62% while the technology-heavy Nasdaq Stock Market Composite Index climbed by 0.95%. The NYSE Composite Index added 0.66% this week. The investor risk perception indicator, the CBOE Volatility Index (VIX) rose by 5.02%.

Technology stocks outperformed on the back of reports of a possible takeover of Intel and news that the CEO of NVIDIA had halted sales of his own shares in the company. Additionally, chip maker Micron Technology surged following its positive outlook for artificial intelligence demand, thereby providing a general tailwind for the sector. Sentiment was also driven in part by economic news. On Tuesday, there was a slight sell-off as news that the Conference Board’s index of U. S. consumer confidence fell sharply in August and put it back close to the bottom of its range over the past two years.

U.S. Economy

This week, it was reported that the index of consumers’ perception of labor market conditions slid to 81.7, only slightly above the threshold of 80 that historically had predicted a recession. There was also some mixed news regarding the housing sector. There have been some recent signals that the sector may be stabilizing as mortgage rates start to descend. On Wednesday, the Commerce Department reported that new home sales declined, although not as much as expected, by 4.7% in August, and building permits data were revised lower. New buyers remained on the sidelines, but the falling mortgage rates appeared to spark a surge in refinancing. Shortly after the Fed started to raise short-term rates, the Mortgage Bankers Association Mortgage Refinance Index jumped to its highest level since April 2022.

On Friday, some benign inflation data helped trigger an early rally in the markets. The Commerce Department reported that the core personal consumer expenditures (PCE) price index (less food and energy), which is the Fed’s preferred inflation gauge, rose by only 0.1% in August, slightly below expectations. The index climbed only 2.2% year-on-year, close to the Fed’s 2.0% long-term inflation target and the lowest since February 2021. Personal incomes and spending in August were both lower than expected, which further signals a moderation in inflationary pressures.

Metals and Mining

Although September has traditionally been a trying time for metals, This week’s trading appears to have broken the trend. The spot prices for precious metals generally went up this week. Gold closed at $2,658.24 per troy ounce, 1.39% higher than the previous weekly close of $2,621.88. Silver settled at $31.57 per troy ounce for the week, higher by 1.25% from the last weekly close at $31.18. Platinum closed this week at $1,003.82 per troy ounce for a gain of 2.49% over last week’s close at $979.43. Palladium ended at $1,016.12 per troy ounce for a decline of 4.95% from last week’s $1,069.01. The three-month LME prices of industrial metals were also mostly up. Copper closed the week at $9,982.50 per metric ton, 5.34% above the last weekly close of $9,476.50. Aluminum rested this week at $2,646.50 for an increase of 6.50% from last week’s close of $2,485.00. Zinc ended at the week’s closing price of $3,089.50 per metric ton, 7.50% higher than last week’s close of $2,874.00. Tin ended the week at $2,913.00, 2.45% higher than the metal’s previous weekly closing price of $32,127.00.

Gold underwent its best monthly gain since March, and while it has drawn much attention from investors, other metals appear to present great prospects. Silver ended this week with some strong selling momentum despite exhibiting some volatility over the past weeks. It rallied to a new 12-year high at $33 per ounce. December silver futures last traded at $31.74 per ounce, down by almost 2% on the day, but up 8.8% for the month. Silver saw renewed buying interest after China launched its most impressive stimulus package since the COVID-19 pandemic. Beijing is pumping more liquidity into the financial markets and has also cut interest rates to prevent its economy from lapsing into a deflationary spiral and pull it back toward its growth target. Almost 50% of the demand for silver comes from industrial applications, mostly from the solar power sector. So far this year, gold prices have ascended by 28.8% while silver prices have rallied by nearly 32%.

Energy and Oil

Firm fundamental support for oil prices has been provided so far by China’s economic stimulus measures and U.S. hurricanes, but the big story this week came from Saudi Arabia. Media outlets alleged that Riyadh is considering a strategy shift to retake its market share in the oil market. According to the Financial Times, Saudi Arabia is adopting measures to raise its crude oil production in a bid to win back market share. It will allegedly abandon its unofficial $100 per barrel oil price target despite the likelihood of lower prices and has raised hopes that OPEC+ would proceed with its December hikes. Market observers witnessed a $3 per barrel drop from one week ago in fear of an oversupply, with WTI dropping below $70 per barrel again.

Natural Gas

For the report week covering Wednesday, September 18, to Wednesday, September 25, 2024, the Henry Hub spot prices rose by $0.29 from $2.33 per million British thermal units (MMBtu) to $2.62/MMBtu.  Regarding Henry Hub futures, the price of the October 2024 NYMEX contract increased by $0.353, from $2.284/MMBtu at the start of the week to $2.637/MMBtu at the week’s end. The price of the 12-month strip averaging October 2024 through September 2025 futures contracts advanced by $0.191 to $3.134/MMBtu. At most locations this report week, natural gas spot prices rose. Price changes ranged from a drop of $0.59 at the Waha Hub to an increase of $0.54 at the FGT Citygate in Florida.

International natural gas futures price changes were mixed this report week. The weekly average front-month futures prices for liquefied natural gas (LNG) cargoes in East Asia decreased by $0.37 to a weekly average of $13.03/MMBtu. Natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands increased by $0.10 to a weekly average of $11.54/MMBtu. In the week last year corresponding to this report week (the week from September 20 to September 27, 2023) the prices were $14.63/MMBtu in East Asia and $12.61 /MMBtu at the TTF.

World Markets

Evidence of slowing business activity spurred hopes for potential interest rate cuts and drove European equities to rally for the week. The pan-European STOXX Europe 600 Index rebounded this week and settled 2.69% higher. Sentiment also lifted as a result of China’s newly launched round of stimulation measures that can energize the global economy. Major stock indexes also rebounded. Italy’s FTSE MIB rose by 2.86%, France’s CAC 40 Index gained 3.89%, and Germany’s DAX surged by 4.03%. The UK’s FTSE Index added 1.10%. According to purchasing managers’ indexes (PMIs) compiled by S&P Global, business activity in the eurozone shrank unexpectedly in September as a result of a significant flow of new orders. An initial reading of the seasonally adjusted HCOB Eurozone Composite PMI Output Index fell from 51.0 in August to 48.9 in September, signifying a shift from expansion to contraction. As the boost from the Paris Olympics faded, services activity came close to stalling. German business activity declined the most in seven months, signaling that a second quarterly drop in output is likely in the outlook of the economy. UK private sector activity, on the other hand, remained in expansionary territory for the 11^th consecutive month.

Japan’s stock markets soared over the week. The Nikkei 225 Index surged by 5.6% while the broader TOPIX Index rose by 3.7%. Providing a favorable backdrop was the latest commentary from the Bank of Japan (BoJ) that was perceived as dovish and which weighed on the yen. China’s fresh round of stimulus announcements that detailed various support mechanisms drove optimism that the country will better respond to sluggish economic growth and the weak housing market. The stimulus announcements boosted the many Japanese companies that directly or indirectly China beneficiaries, given the large volume of Japanese exports that go to China and Japan’s sensitivity to the Chinese purchasing managers’ index. Regarding Japan’s economic front, the Tokyo-area core consumer price index (CPI) rose by 2.0% year-on-year in September, down from 2.4% in August. Given that the indicator is considered a leading indicator of nationwide trends, there is a slowdown in consumer inflation, although this was expected and largely attributable to the effect of renewed energy subsidies. Separately, flash PMI data collated by an Jibun Bank showed that Japan’s private sector continued to expand in September albeit the rate of growth has slowed slightly from August. The driver of the expansion was business activity in the services segment, while manufacturing output contracted marginally.

China’s stocks skyrocketed after Beijing set into motion a host of measures to shore up the economy. The Shanghai Composite Index jumped 12.8% while the blue-chip CSI 300 soared by 15.7%. Hong Kong’s benchmark Hang Seng Index gained 13%. The rally charted the biggest weekly for the CSI 300 since 2008. At that time, Beijing put into effect a massive stimulus package to address the global financial crisis. To meet the present economic challenges, China’s top leaders committed to take action to stabilize the property market and halt the decline of real estate prices. The 24-man Politburo stated that China would deploy the necessary fiscal spending to meet its 2024 growth target of 5%. Although there were no specifics contained in the Politburo statement, China plans to issue special sovereign bonds worth about RMB 2 trillion (USD 284.4 billion) this year as part of the financial stimulus plan, plus other measures. All in all, the stimulus package is a positive development for China’s economy and will bolster short-term economic activity and enhance market sentiment. In the long term, however, it is not certain that the present steps taken will be sustainable in the long run.

The Week Ahead

Among the important economic data scheduled for release this week are the September non-farm payrolls report, the ISM manufacturing PMI, and the ISM services PMI all for September.

Key Topics to Watch

• Federal Reserve Governor Michelle Bowman speaks (Sept. 30)
• Chicago Business Barometer (PMI) for Sept.
• Federal Reserve Chair Jerome Powell speaks (Sept. 30)
• S&P final U.S. manufacturing PMI for Sept.
• ISM manufacturing for Sept.
• Construction spending for Aug.
• Job openings for Aug.
• Federal Reserve Governor Lisa Cook speaks (Oct. 1)
• Richmond Fed President Tom Barkin, Atlanta Fed President Raphael Bostic and Boston Fed President Susan Collins on a joint panel about technology-enabled disruption (Oct. 1)
• Auto sales for Sept.
• ADP employment for Sept.
• Cleveland Fed President Beth Hammack gives welcoming remarks (Oct. 2)
• Louis Fed President Alberto Musalem gives opening remarks (Oct. 2)
• Federal Reserve Governor Michelle Bowman speaks (Oct. 2)
• Richmond Fed President Tom Barkin speaks (Oct.2)
• Initial jobless claims for Sept. 28
• S&P final U.S. services PMI for Sept.
• ISM services for Sept.
• Factory orders for Aug.
• Minneapolis Fed President Neel Kashkari moderates discussion with Atlanta Fed President Raphael Bostic (Oct. 3)
• U.S. nonfarm payroll for Sept.
• U.S. unemployment rate for Sept.
• U.S. hourly wages for Sept.
• Hourly wages year over year
• New York Fed President John Williams gives opening remarks (Oct. 4)

 Markets Index Wrap-Up

Stock Markets

The major stock indexes are mostly up for the week. The 30-stock Dow Jones Industrial Average (DJIA) rose by 1.62% while the Total Stock Market Index gained 1.49%. The broad-based S&P 500 Index advanced by 1.36% while the technology-heavy Nasdaq Stock Market Composite added 1.49%. The NYSE Composite climbed by 1.32%. The investor risk-perception indicator, the CBOE Volatility Index (VIX) slid by 2.48%.

The large-cap indexes climbed to record highs as investors rushed to take positions on what they perceived to be a prolonged Fed rate-cutting cycle. The rally was relatively broad. Smaller-cap indexes outperformed even while remaining below their previous highs. In particular, the small-cap Russell 2000 Index closed the week about 9% below its all-time high set in November 2021. The week prior, although the rate cut was generally expected, there was a split in opinion between whether the rate cut would amount to the more cautious 25 basis points (0/25%) or 0.50%. Initial reaction to the Fed’s decision to “go bigger” was comparatively muted, with the S&P 500 Index falling slightly before the day’s end.

U.S. Economy

For the first time in four years, the U.S. Federal Reserve, or Fed, lowered its policy rate last week. The rate cut, a larger-than-usual 0.5% or 50-basis-point reduction, signals that the monetary policy cycle has entered a critical turning point and that the Fed has adopted a proactive approach that increases the likelihood of a soft landing. The projected series of rate cuts tends to lower borrowing costs for consumers and businesses over time. The result points to reaccelerated growth in 2025.

The Commerce Department announced on Tuesday that retail sales had risen 0.1% which is more than anticipated and followed an upwardly revised growth rate of 1.1% in July. On Thursday, more evidence that consumers remained strong came in the form of a lower-than-expected weekly jobless claims report. Likewise, continuing claims dropped to their lowest level in three months.

Investors also showed interest in improving data regarding the troubled housing sector. Building permits rose by 4.9% in August, their biggest monthly gain in a year, according to the Commerce Department in a report released on Wednesday. This restores the building permits statistic to its highest level since March. On the contrary, the sales of existing homes had unexpectedly fallen by 2.5% in August, as reported by the National Association of Home Builders. Fed Chair Powell stressed that the central bank had limited influence on housing prices and easing the current tight housing supply.

Metals and Mining

Gold ended this week at a new high, but its path had been volatile and far from smooth. December gold futures last traded at $2.647.40 per ounce, higher by 1% from one week ago. Gold prices sharply rallied after the Federal Reserve cut interest rates by 50 basis points, as expected. The move signaled that rates could drop to 3% by mid-2026. In an attempt to quickly quell the market rally, Federal Reserve Chair Jerome Powell warned investors that the Fed is not in a hurry to further lower rates drastically or too son.  Instead, the committee foresees that interest rates will be reduced in an orderly manner, keeping the neutral rate well above 0%. This is unlike the levels encountered during the Great Financial Crisis and the pandemic.

The spot markets for precious metals were mixed this week. Gold gained 1.71% from its close last week at $2,577.70 to its closing price this week at $2,621.88 per troy ounce. Silver added 1.50% from last week’s closing price of $30.72 to end this week at $31.18 per troy ounce. Platinum lost 1.93% from last week’s close at $998.70 to settle this week at $979.43 per troy ounce. Palladium also gave back 0.16% from its closing price last week at $1,070.73 to end this week at $1,069.01. The three-month LME prices of industrial materials were also mixed. Copper, which closed at $9,308.00 one week ago, ended at $9,476.50 per metric ton for a gain of 1.81%. Aluminum, which closed last week at $2,471.00, ended this week at $2,485.00 per metric ton to realize a gain of 0.57%. Zinc settled this week at $2,874.00 per metric ton, 1.05% lower than last week’s close of $2,904.50. Tin closed this week at $32,127.00 per metric ton, 1.01% higher than its close last week at $31,805.00.

Energy and Oil

For the second straight week, oil prices registered week-on-week gains as the WTI rebounded above $70 per barrel. It is now trading closer to the $72 per barrel resistance level. It is likely, however, that the fact that the Fed has finally initiated a new cycle of monetary easing should prompt a stronger market response. Additionally, crude oil inventories in the United States have plummeted to their lowest level in a week to post another week-on-week decline to 417.5 million barrels. Stocks were particularly drained in the Midwest where they fell to their lowest since December 2014. Next week could see further upside due to a weaker dollar and an improved macro risk outlook.

Natural Gas

For the report week from Wednesday, September 11 to Wednesday, September 18, 2024, the Henry Hub spot price rose by $0.19 from $2.14 per million British thermal units (MMBtu) to $2.333/MMBtu. Regarding the Henry Hub futures, the price of the October 2024 NYMEX contract increased by $0.01, from $2.270/MMBtu to $2.284/MMBtu for the same week. The price of the 12-month strip averaging October 2024 through September 2025 futures contracts decreased by $0.02 to $2.944/MMBtu.

International natural gas futures prices decreased for this report week. The weekly average front-month futures prices for liquefied natural gas (LNG) cargoes in East Asia decreased by $0.38 to a weekly average of $13.40/MMBtu.  Natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands decreased by $0.32 to a weekly average of $11.44/MMBtu. In the week last year corresponding to this report week (the week from September 13 to September 20, 2023), the prices were $13.83/MMBtu in East Asia and $11.29/MMBtu at the TTF.

World Markets

European stocks slid as the rally triggered by the Fed’s rate cut in the US was discounted by the market. The pan-European STOXX Europe 600 Index descended by 0.33%. Investors appear to have grown cautious about the monetary policy outlook moving forward, now that the long-anticipated rate cut has taken place. Major stock indexes advanced in the region. Germany’s DAX squeezed out a 0.11% increase, France’s CAC 40 Index had a more substantial gain of 0.47%, and Italy’s FTSE MIB added 0.58%. The UK’s FTSE 100 Index went in the opposite direction and lost 0.52%. The Bank of England (BoE) met expectations by holding its key policy rate at 5% after the Monetary Policy Committee voted 8-1 to adopt no change. According to Gov. Andrew Bailey, “It is vital that inflation stays low, so we need to be careful not to cut too fast or by too much,” although he expressed optimism that rates would further fall with further evidence that the inflationary pressures were cooling.  Regarding the European economy, hourly wages and salaries in the Eurozone grew at an annual rate of 4.5% in the three months through June, down from a revised 5.2% in the first quarter.

Japan’s equities markets climbed this week, as the Nikkei 225 Index advanced by 3.1% and the broader TOPIX Index gained 2.8%. As the yen weakened on the U.S. Federal Reserve’s latest monetary policy decision to cut interest rates for the first time since its series of steep rate hikes, Japanese stocks benefited. The Fed delivered an outsized 50-basis-point reduction in interest rates. The Bank of Japan’s (BoJ’s) decision to leave rates unchanged on Friday further weighed on the yen, which depreciated to about JPY 143.8 against the U.S. dollar. At the end of the previous week, the currency exchange rate was around 140.8 yen versus the greenback. The yield on the 10-year Japanese government bond rose to 0.86% from 0.84% the prior week. On the economic front, Japan’s core consumer price index (CPI) for August rose by 2.8% year-on-year from 2.7% in July and generally in line with expectations. Also matching consensus was the overall CPI which rose by 3.0% up from 2.8% in July.

On this holiday-shortened week, Chinese stocks rose as the Fed’s decision to cut interest rates offset disappointing economic data released during the week. The Shanghai Composite Index added 1.21% while the blue-chip CSI 300 gained by 1.32%. The Hong Kong benchmark Hang Seng Index advanced by 5.12%. The markets this week in mainland China were closed on Monday and Tuesday for the Mid-Autumn Festival, while Hong Kong markets were closed on Wednesday but reopened on Thursday. Disappointing August data only brought into focus the slowing momentum of China’s economy. Amid weaker commodity prices and auto sales, industrial production rose by 4.5% from last year, lower than forecasted and down from July’s 5.1% increase. Expansion in retail sales was 2.1% year-on-year, compared to July’s 2.7% rise and short of expectation. The January to August fixed asset investment rose by a lower-than-expected 3.4% down from 3.6% for the same period last year. Property investment fell by 10.2% year-on-year. New home prices in 70 cities fell by 0.7% in August, unchanged from the pace of declines in the prior three months and marking the 14^th consecutive monthly decline. In their overall picture, the indicators suggest that Beijing is encountering a growing risk in meeting its economic growth target of around 5% this year. Many economists therefore expect that China’s government will try to stimulate the economy by implementing further easing measures.

The Week Ahead

PCE inflation data, an analysis of consumer confidence, and a revised GDP reading are among the important economic news expected to be released in the coming week.

Key Topics to Watch

• Atlanta Fed President Raphael Bostic speaks (Sept. 23)
• S&P flash U.S. services PMI for Sept.
• S&P flash U.S. manufacturing PMI for Sept.
• Chicago Fed President Austan Goolsbee speaks (Sept. 23)
• Minneapolis Fed President Neel Kashkari speaks (Sept. 23)
• Federal Reserve Governor Michelle Bowman speaks (Sept. 24)
• S&P Case-Shiller home price index (20 cities) for July
• Consumer confidence for Sept.
• New home sales for Aug.
• Federal Reserve Governor Adriana Kugler speaks (Sept. 25)
• Initial jobless claims for Sept. 21
• Durable-goods orders for Aug.
• Durable-goods minus transportation for Aug.
• GDP (second revision) for Q2
• Federal Reserve Governor Adriana Kugler and Boston Fed President Susan Collins speak together (Sept. 26)
• Federal Reserve Governor Michelle Bowman speaks (Sept. 26)
• Federal Reserve Chair Jerome Powell gives opening remarks (Sept. 26)
• New York Fed President John Williams speaks (Sept. 26)
• Pending home sales for Aug.
• Federal Reserve Vice Chair for Supervision Michael Barr speaks (Sept. 26)
• Federal Reserve Governor Lisa Cook speaks (Sept. 26)
• Minneapolis Fed President Neel Kashkari speaks with Fed Vice Chair for Supervision Michael Barr (Sept. 26)
• Personal income for Aug.
• Personal spending for Aug.
• PCE index for Aug.
• PCE (year-over-year)
• Core PCE index for Aug.
• Core PCE (year-over-year)
• Advanced U.S. trade balance in goods for Aug.
• Advanced wholesale inventories for Aug.
• Advanced retail inventories for Aug.
• Consumer sentiment (final) for Sept.
• Federal Reserve Governor Michelle Bowman speaks (Sept. 27)

Markets Index Wrap-Up

Stock Markets

All the major U.S. stock market indexes rallied during the week. The 30-stock Dow Jones Industrial Average (DJIA) ended the week 2.60% higher, and the Total Stock Market Index climbed by 4.04%. The S&P 500 Index, a broad-based metric, ascended by 4.02%, while the technology-heavy Nasdaq Stock Market Composite jumped by 5.95%, the best-performing index for the week. The NYSE Composite Index gained 2.46%. The risk perception indicator, the CBOE Volatility Index (VIX) dropped by 26.01%.

Stocks posted solid gains this week and recovered from the steep losses of the weeks preceding it. The pullback in weeks past saw the S&P 500 Index plunge to its worst weekly decline since March 2023. For this week, growth stocks outpaced value shares by a wide margin due to the strong performance of the technology stocks that caused the Nasdaq to outperform the other indexes. After NVIDIA offered a positive outlook on artificial intelligence at an investment conference, its stock surged. The week was particularly busy generally due to numerous conferences, and this seemed to drive the week’s positive sentiment.

U.S. Economy

The Labor Department’s inflation reports dominated the week’s relatively light economic calendar. Stocks initially headed sharply lower on Wednesday on news that core consumer inflation (excluding food and energy) rose a bit higher than consensus expectations to 0.3% in August. Headline inflation, meanwhile, showed an annual increase of 2.5% which is well below the 2.9% increase in July, and its lowest level since early 2021. Other economic reports also provided some hope for the troubled housing sector. On Wednesday, the Mortgage Bankers Association reported that the average rate for a 30-year, fixed-rate mortgage dropped to 6.29%, well below the 7.21% one year ago and the lowest since February. The Association also reported that its index of home loan applications continued to climb off its August lows – a heartening sign, since this indicator is a leading signal of home purchases.

Metals and Mining

Gold is ending the week at a new all-time high above $2,500 per ounce, higher by more than 3%  while silver charted an even larger percentage gain, almost 10% up. U.S. inflation surpassed analysts’ expectations, with the combined dip in U.S. Treasury yields and the U.S. dollar. These developments prompted investors to send the price of bullion skyrocketing. According to analysts, markets expect a 45% probability of a more aggressive move next week. The U.S. economy has held up relatively well, even as activity slows, so it is difficult to justify this market reaction. Consumer prices dropped more than expected this past week, but core inflation (which excludes volatile energy and food prices) increased by 3.2%, slightly up from July, which is not exactly an economy that is addressed with aggressive rate cuts. As interest rates fall worldwide, global real yields move lower, which is consistent with driving the precious metals rally seen this week.

Precious metal spot prices rebounded for the week. Gold rose by 3.21% from its closing price last week of $2,497.41 to end this week at $2,577.70 per troy ounce. Silver ended 9.95% higher than last week’s close at $27.94 to close at $30.72 per troy ounce. Platinum landed 8.00% higher than its close a week ago at $924.71 to trade last this week at $998.70 per troy ounce. Palladium ascended by 16.89% from its previous weekly close at $916.05 to close this week at $1,070.73 per troy ounce. The three-month LME prices of base metals have also appreciated. Copper, traded last week at $9,092.00, ended this week at $9,308.00 per metric ton for an increase of 2.38%. Aluminum, which closed last week at $2,378.50, settled this week at $2,471.00 per metric ton for a gain of 3.89%. Zinc rose by 6.10% from its closing price last week of $2,737.50 to end this week at $2,904.50 per metric ton. Tin closed this week at $31,805.00 per metric ton, 3.36%          higher than its price last week of $30,771.00.

Energy and Oil

Oil prices edged higher this week after Hurricane Francine sparked bearish sentiments that overtook the market. As Hurricane Francine made landfall in Louisiana this week as a Category 2 hurricane, about 42% of crude oil and 53% of natural gas production was pre-emptively shut in across the US Gulf of Mexico. Some 730,000 barrels per day (b/d) and 992 million cubic ft per day were taken off the market, even if just for several days. After UN-brokered talks collapsed, a large amount of Libyan production remained shut-in, signifying that supply disruptions now total 1.5 million b/d already. With China’s pessimism peaking in the entire post-pandemic period, however, it would take more than supply disruptions for Brent to rise above its current price of $73 per barrel.

Natural Gas

For the report week from Wednesday, September 4 to Wednesday, September 11, 2024, the Henry Hub spot price rose by $0.08 from $2.06 per million British thermal units (MMBtu) to $2.14/MMBtu. Concerning Henry Hub futures, the price of the October 2024 NYMEX contract increased by $0.125 from $2.145/MMBtu at the start of the report week to $2.270/MMBtu at the week’s end. The price of the 12-month strip averaging October 2024 through September 2025 futures contracts increased by $0.025 to $2.959/MMBtu. Regional natural gas spot price changes were mixed this report week, ranging from an increase of $0.12 at FGT Citygate to a decrease of $1.07 at both the Waha Hub and Northwest Sumas.

International natural gas futures prices decreased this report week. Weekly average front-month futures prices for liquefied natural gas (LNG) cargoes in East Asia decreased $0.15 to a weekly average of $13.78/MMBtu. Natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands, the most liquid natural gas market in Europe, decreased by $0.52 to a weekly average of $11.76/MMBtu. In the week last year corresponding to this report week (from September 6 to September 13), the prices were $13.36/MMBtu in East Asia and $10.99/MMBtu at the TTF.

World Markets

European stocks ended the week higher on positive sentiment created by the interest rate cut from the European Central Bank (ECB). The pan-European STOXX Europe 600 rose by 1.85% in local currency terms. Major indexes likewise climbed in tandem with the pan-European index. Germany’s DAX climbed by 2.1%, France’s CAC 40 Index rose by 1.54%, and Italy’s FTSE MIB gained by 0.83%. The UK’s FTSE 100 Index added 1.12%. The ECB announced a quarter-point cut in its deposit rate to 3.5% – in line with expectations. This is a reduction in its deposit rate for the0.4% incresae second time this year. ECB’s move was prompted by signs of weakening economic growth and slowing inflation in the Eurozone. The central bank nevertheless emphasized that it remains cautious and stressed that it is not “pre-committing to a particular rate path.” The updated quarterly forecasts for headline inflation remain unchanged. However, due to stronger-than-expected services prices, core inflation was revised modestly higher for the next two years. The modified economic growth forecasts by the ECB are now one percentage point less in 2024 (0.8%), 2025 (1.3%), and 2026 (1.5%).

Japan’s stock markets ended mixed over the week. The Nikkei 225 Index gained 0.5% and the broader TOPIX Index lost by 1.0%. As the yen strengthened to the high end of the JPY 140 range against the USD from the previous week’s JPY 142.3, Japanese exporters continued to face currency headwinds amid a hawkish outlook on the monetary policy of the Bank of Japan (BoJ). The latest comments from members of the BoJ’s board bolstered expectations that the central bank will raise interest rates again this year. One member, Junko Nakagawa, said that if the outlook for Japan’s economy and inflation is realized, the degree of monetary easing will be adjusted as the current level of real rates is extremely low. Another member, Naoki Tamura, suggested that the short-term rate needs to be raised to at least around 1% in the second half of the BoJ’s projection period through fiscal year 2026 to curb upside inflation risks and maintain price stability. Although the comments were hawkish, the yield on the 10-year Japanese government bond (JGB) dipped to 0.84% from 0.86% at the end of the prior week. The JGB tracked U.S. bonds lower on speculation that the Fed could more aggressively cut interest rates by 50 basis points at the September FOMC meeting.

Chinese stocks fell due to weak inflation data that fueled concerns about a downward price-wage spiral weighing on the economy. The Shanghai Composite Index and the blue-chip CSI 300 both fell by 2.23%. The Hong Kong benchmark Hang Seng Index lost by 0.43%. China’s consumer price index (CPI) inched up by 0.6% in August year-on-year, up from 0.5% in July, but this is still below economists’ forecast. Core inflation (excluding food and energy costs) rose by 0.3% which is slower than July’s 0.4% increase and marks the lowest level in more than three years. The producer price index (PPI) fell by 1.8% from last year, deepening from July’s 0.8% drop and lagging forecasts. The PPI extends the deflation in factory gate prices that began in late 2022. The latest data encouraged calls for the government to roll out additional stimulus measures to move back a negative cycle of falling corporate revenue, wages, and spending that, if it happened, would threaten the country’s long-term growth. Other news saw exports exceeding forecast in August by rising 8.7% from one year earlier compared to 7% growth in July. China’s exports are the bright spot in China’s economy, which is mired in the prolonged property crisis.

The Week Ahead

The FOMC interest rate decision, retail sales data, and initial jobless claims are among the important economic releases expected in the coming week.

Key Topics to Watch

• Empire State manufacturing survey for Sept.
• U.S. retail sales for Aug.
• Retail sales minus autos for Aug.
• Industrial production for Aug.
• Capacity utilization for Aug.
• Business inventories for July
• Home builder confidence index for Sept.
• Housing starts
• Building permits for Aug.
• FOMC interest-rate decision
• Fed Chair Powell press conference
• Initial jobless claims for Sept. 14
• Philadelphia Fed manufacturing survey for Sept.
• Existing home sales for Aug.
• U,S. leading economic indicators for Aug.

Markets Index Wrap-Up

Stock Markets

Stocks corrected this week on the back of a disappointing labor market report. The 30-stock Dow Jones Industrial Average (DJIA) plummeted by 2.93% while the Total Stock Market Index plunged even deeper, by 4.38%. The broad S&P 500 Index came down by 4.25%, but the technology-heavy Nasdaq Stock Market Composite even underperformed the other major indexes by giving back 5.77%. The NYSE Composite slid by 3.26%. The risk perception indicator CBOE Volatility Index (VIX) shot up by 43.92%.

The S&P 500 experienced its deepest weekly drop in 18 months due to worries over an economic slowdown weighed on investors’ sentiment. Leading the declines were information technology shares, partly driven by NVIDIA following rumors that the firm might be the subject of an antitrust investigation by the Justice Department. September has historically been one of the worst months for stocks, averaging a monthly 0.7% drop since 1950. On the other hand, the S&P 500 has experienced declines of 4.9%, 9.3%, 4.8%, and 3,9% during September over the last four years. These suggest that investor nervousness over seasonal trading patterns may be a factor in the September declines. Trading volumes rose as investors returned to the market after the summer vacation and the long Labor Day weekend.

U.S. Economy

Economic news released during the week generally surprised on the downside and raised concerns that the Federal Reserve may have delayed too long before easing monetary policy. The Institute for Supply Management reported on Tuesday that its gauge for U.S. manufacturing activity remained in the contraction territory in August as new orders fell for the third straight month.

The report of July’s job openings by the Labor Department, which was released on Wednesday, further disappointed with the number of unfilled positions falling to 7.67 million, its lowest level since January 2021. Payroll processing firm ADP reported on Thursday that its count of private payrolls had increased only by 99,000 in August, the weakest since January 2021 and well below expectations. The U.S. economy created 142,000 jobs, falling short of the expected 164,000.  July’s gain was revised down to 89,000, marking the lowest level since December 2020. Simultaneously, the unemployment rate fell to 4.2% from 4.3% while average hourly earnings rose by a better-than-expected 0.4%.

Friday’s jobs data appeared to sharply reduce expectations that the Fed would cut rates by a full 50 basis points. Nevertheless, a rate cut is still to be expected at the Fed’s upcoming policy meeting in September, leading many to expect a reduced 25-basis-point decrease.

Metals and Mining

Investors took profits this week as expectations for an aggressive easing of an aggressive rate easing were rolled back. Investors appear to accept that the Fed will cut rates by 25 basis points less than two weeks before the Federal Reserve’s monetary policy meeting. Expectations appear to firm up after data from the U.S. Bureau of Labor Statistics indicated that the labor market is cooling but not collapsing.  Technical analysts have warned that the gold market appeared to be overextended above $2,550 per ounce as a 50-basis-point cut seemed unlikely. Furthermore, due to seasonal factors, September is one of the worst months for gold. Rather than any single event, gold investors need to focus on the path of rate cuts. The long-term rally is far from over. The economy is slowing and real interest rates will trend lower. This is an ideal environment for gold.

Gold ended this week at $2,497.41 per troy ounce, 0.24% lower than last week’s close of $2,503.39. Silver was last traded this week at $27.94 per troy ounce, 3.19% below the previous week’s closing price of $28.86. Platinum closed the week at $924.71 per troy ounce, 0.55% below its close last week at $929.79. Palladium was last traded at $916.05 per troy ounce, lower by 5.53% from the previous week’s closing price of $969.63. The three-month LME prices of industrial metals also went south. Copper, which ended last week at $9,235.00, last traded this week 1.55% lower, at $9,092.00 per metric ton. Aluminum, transacted last week at $2,447.00, fell by 2.80% to close this week at $2,378.50 per metric ton. Zinc, which closed last week at $2,897.00, lost this week by 5.51% to end at $2,737.50 per metric ton. Tin, priced last week at $32,346.00, last traded this week at $30,771.00 per metric ton for a 4.87% loss.

Energy and Oil

Typically, OPEC+ decisions which tend to impact highly on the market trigger reactions among investors. The same is not true about the group’s recent decision to postpone the return of barrels they have cut in 2023. Eight members of OPEC+ that were scheduled to unwind their 2.2 million barrels per day (b/d) of voluntary production cuts have agreed to delay their production hikes by two months, citing worse-than-assumed economic data from China and the United States. The lack of any reaction reinforces concerns that next year will see balances swinging heavily towards oversupply. Oil prices are set to close this week at their lowest level since June 2023 as ICE Brent hovers around $73 per barrel.

Natural Gas

For the report week beginning Wednesday, August 28, to Wednesday, September 4, 2024, the Henry Hub spot price rose by $0.17 from $1.89 million British thermal units (MMBtu) to $2.06/MMBtu. Regarding Henry Hub futures, the price of the October 2024 NYMEX contract increased by $0.048, from $2.097/MMBtu to $2.145/MMBtu this report week. The price of the 12-month strip averaging October 2024 through September 2025 futures contracts increased by $0.082 to $2.934/MMBtu. Natural gas spot prices rose at all major pricing locations this report week. The price increases ranged from $0.14 at the FGT Citygate to $3.57 at the Waha Hub.

International natural gas futures price changes were mixed for this week. Weekly average front-month futures prices for liquefied natural gas (LNG) cargoes in East Asia increased by $0.03 to a weekly average of $13.93/MMBtu. Natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands, the most liquid natural gas market in Europe, decreased by $0.04 to a weekly average of $12.28/MMBtu. In the week last year that corresponds with this report week (from August 30 to September 6, 2023), the prices were $13.26/MMBtu in East Asia and $10.75/MMBtu at the TTF.

World Markets

European stocks fell on renewed fears regarding the deteriorating outlook for global economic growth. This week, the pan-European STOXX Europe 600 Index closed 3.52% lower in local currency terms. Major stock indexes in the region also ended weaker. Italy’s FTSE MIB lost by 3.15%, Germany’s DAX lost by 3.20%, and France’s CAC 40 Index plunged by 3.65%.  The UK’s FTSE 100 fell by 2.33%. UK and Eurozone government bond yields dropped across the board. As prospects appear mixed, the European Central Bank (ECB) potential rate cut rate cut is increasingly likely. ECB Governing Council member Gediminas Simkus said that he saw a “clear case” for a September interest rate cut, but that the potential for another rate cut in October was “quite unlikely.” Rate cuts could decrease in September but the policy should only ease gradually. Recent economic data so far confirms that inflation is slowing, enabling the ECB to lower borrowing costs without risking premature easing. Meanwhile, following an upward revision of June’s result to 4.6%, German manufacturing orders in July rose unexpectedly by 2.9% sequentially after seasonal and calendar adjustments. When large orders for transportation equipment were excluded, however, factory orders dropped by 0.4%.

Japan’s stocks succumbed to a sell-off for the week. The Nikkei 225 Index fell by 5.8% while the broader TOPIX Index lost by 4.2%. The market slumped halfway through the week due to semiconductor stocks tracking a U.S.-led sell-off, and the strength of the yen posed a headwind for Japan’s export-oriented companies. The yen strengthened from around JPY 145 the previous week to the JPY mid-142 range against the US dollar on expectations of narrowing Japan-U.S. interest rate differentials. The market anticipates that interest rates will be raised further this year by the Bank of Japan (BoJ), while the U.S. Federal Reserve is expected to cut interest rates in September.  Demand for Japanese government bonds (JGB) grew as investors sought assets with lower risk. This is on the back of the perception that the U.S. economic data points to the possibility that the world’s largest economy is headed for a recession. The 10-year JGB yield dropped to 0.86% from 0.90% at the end of the previous week, despite data showing that Japan’s real wages (adjusted for inflation) grew by 0.4% year-on-year in July boosted by pay increases and summer bonuses. On the other hand, household spending rose only 0.1% year-on-year in July and remains sluggish despite solid income growth.

Chinese stocks pulled back due to weak corporate earnings and economic data. The Shanghai Composite Index declined 2.69% while the blue-chip CSI 300 gave up 2.71% for the week. The Hong Kong benchmark Hang Seng Index lost 3.03%. The National Bureau of Statistics reported that production and new order declines deepened, resulting in China’s official manufacturing purchasing managers’ index (PMI) slipping to a lower-than-expected 49.1 in August from 49.4 in July. The gauge holds below the 50-mark threshold that separates growth from contraction for all but three months since. The indicator for construction and services activity, the non-manufacturing PMI, exceeded expectations by inching up to 50.3 in August from 50.2 in July. The value of new home sales by the country’s top 100 developers fell by 26.8% year-on-year in August, picking up pace from a 19.7% drop in July, based on an assessment by the China Real Estate Information Corp. This continued drop in new home prices shows the waning impact of the government’s real estate rescue package in May, fueling further speculation that Beijing may announce further support measures to halt the property downturn. China’s housing clump, which is now in its fourth year, and rising trade tensions continue to weigh on China’s growth outlook, sending mixed signals to investors.

The Week Ahead

The CPI and PPI inflation data and consumer sentiment data are important economic releases scheduled for the week to come.

Key Topics to Watch

• Wholesale inventories for July
• Consumer credit for Aug.
• NFIB optimism index for Aug.
• Consumer price index for Aug.
• CPI year over year
• Core CPI for Aug.
• Core CPI year over year
• Initial jobless claims for Sept. 7
• Producer price index for Aug.
• Core PPI for Aug.
• PPI year over year
• Core PPI year over year
• Monthly U.S. federal budget for Aug.
• Import price index for Aug.
• Import price index minus fuel for Aug.
• Consumer sentiment (prelim) for Sept.

Markets Index Wrap-Up

Stock Markets

Most of the major indexes ended in positive territory. The Dow Jones Industrial Average (DJIA) gained modestly by 0.94% and the Total Stock Market Index gained by 0.21%. The S&P 500 Index inched up by 0.24% while the NYSE Composite rose by 1.04%. Among the major indexes, only the technology-heavy Nasdaq Stock Market Composite Index suffered a loss, although a modest one of 0.92%. The CBOE Volatility Index (VIX), the indicator of investors’ risk perception in the market, fell by 5.42%, suggesting that the market consolidation contributed to lower volatility risk in the market.

Trading this week was light ahead of the Labor Day holiday weekend. Fewer shares exchanged hands on Monday more than any other full trading day (excluding early closes) this year so far. The Nasdaq Composite underperformed the other major indexes, having been pulled lower partly by the chip company NVIDIA which lost $300 billion or 10% of its value at the stock’s lowest point on Thursday. Value stocks outperformed growth shares by the largest margin since late July. The market will remain closed on Monday in observance of the Labor Day holiday.

U.S. Economy

Playing a robust role in driving sentiment in the markets this week is the end of the earnings season and the week’s moderately busy economic calendar. The Labor Department’s release of its core personal consumption expenditure (PCE) price index on Friday morning was the most closely watched data point this week. The core PCE price index is the Federal Reserve’s preferred inflation gauge, and it showed that prices rose by 2% in July which aligned largely with expectations. The year-on-year price increase was a tick below the consensus of 2.6%, pleasing investors with the confirmation that inflation remained subdued and close to the Fed target. In particular, Nasdaq futures surged in the wake of the release.

On the back of improving inflation concerns, the housing sector appeared to be the weakest in the expanding economy. On Thursday, the National Association of Realtors reported that pending home sales had plummeted by 5.5% in July, the lowest level on record since 2001. The drop was attributed by the association’s chief economist to “affordability challenges and some degree of wait-and-see related to the upcoming U.S. presidential election,” and the expectations by some buyers that mortgage rates will drop as the Fed eases policy.

Metals and Mining

Precious metals, particularly gold and silver, came under strong selling pressure ahead of the four-day Labor Day weekend. Understandably, some players may want to close their positions particularly facing a month-end and before a protracted holiday weekend, and while prices may have room to move lower, it retains a significant upward momentum. As gold reached its all-time highs above $2,500 per ounce last week, technical momentum indicators did not suggest that the market was close to overheating. Despite gold’s record highs, there is little of the euphoria that traditionally accompanies a market top in gold. Another indication is that while gold is not in overbought territory, the U.S. dollar is oversold and may be facing a potential bounce. The U.S. dollar index this week dropped to its lowest levels since mid-July 2023 and is testing support at 100.50. The dollar index measures the greenback against a basket of currencies. Interest rates may soon be coming down, and some volatility may be expected in the gold market as it reacts to forces such as the U.S. dollar, but the marketplace still affords some broad support.

The precious metals spot market entered a slight correction for the week. Gold, which ended at $2,512.59 last week, closed at $2,503.39 per troy ounce this week for a dip of 0.37%. Silver came from its close last week at $29.82 to end this week at $28.86 per troy ounce for a loss of 3.22%. Platinum descended from its close last week at $965.62 to close this week at $929.79 per troy ounce to register a loss of 3.71%. Palladium, which closed last week at $964.30, bucked the trend and ended at $969.63 per troy ounce for a gain of 0.55%. The three-month LME prices for industrial metals also registered a correction. Copper closed at $9,235.00 per metric ton this week for a loss of 0.58% from last week’s close of $9,288.50. Aluminum closed this week at $2,447.00 per metric ton, a decline of 3.74% from last week’s close at $2,542.00. Zinc slid by 0.52% from its close last week at $2,912.00 to close this week at $2,897.00 per metric ton. Tin dipped by 72% from its ending price last week of $32,912.00 to settle this week at $32,346.00 per metric ton.

Energy and Oil

Oil markets have undergone a volatile week due to Libya’s oil blockade that sent a supply shock through the markets, after which traders returned to focus their attention on China’s demand. Iraq has simultaneously exerted mounting pressure on Kurdish producers to reduce their output. Aftermarket reports indicated that output in the region is as high as 350,000 barrels per day (b/d), the federal Iraqi government sent an ultimatum to Kurdistan’s Regional Government to reduce its crude production. The move undermines Iraq’s commitments under the OPEC+ compensation plan. Meanwhile, the U.S. has released some constructive macroeconomic news. Oil prices swung back into the red early on Friday morning, with Brent trading at $78.54 and WTI below $75.

Natural Gas

For the report week from Wednesday, August 21, to Wednesday, August 28, 2024, the Henry Hub spot price fell by $0.23 from $2.12 per million British thermal units (MMBtu) to $1.89/MMBtu. Regarding Henry Hub futures, the September 2024 NYMEX contract expired at the end of this report week at $1.930/MMBtu, down by $0.25 from the start of the report week. The October 2024 NYMEX contract price decreased to $2.097/MMBtu, down by $0.22 from the start to the end of the report week. The price of the 12-month strip averaging October 2024 through September 2025 futures contracts declined by $0.11 to $2.957/MMBtu.

At all major pricing locations this report week, natural gas spot prices fell. Price declines range from $2.83 at the Waha hub in West Texas to $0.01 at the Eastern Gas South. Regarding the international natural gas futures, price changes were mixed during the report week. The weekly average front-month futures prices for liquefied natural gas (LNG) cargoes in East Asia were unchanged this week at $13.90/MMBtu. Natural gas futures for delivery at the Title Transfer Facility in the Netherlands, the most liquid natural gas market in Europe, decreased by $0.28 to a weekly average of $12.32/MMBtu. In the week last year corresponding to this report week, (from August 23 to August 30, 2023), the prices were $13.33/MMBtu in East Asia and $11.22/MMBtu at the TTF.

World Markets

European stock indexes ended higher for the week in a rally for the fourth week in response to sharply slower inflation. The pan-European STOXX Europe 600 Index gained 1.34% as it rose to a record high. The significant slowdown in inflation supports the case for the European Central Bank (ECB) to cut interest rates in September. Major stock indexes reflected this rally. France’s CAC 40 Index added 0.71%, Germany’s DAX registered a new peak as it accelerated by 1.47%, and Italy’s FTSE MIB surged by 2.15%. The UK’s FTSE 100 Index gained by 0.59%. The Eurozone headline inflation dropped to 2.2% in August from 2.6% in July, closer to the 2% target set by the European Central Bank (ECB), although some policymakers still urge caution. The August inflation figure is the lowest level in three years. Responsible for the decline are higher energy costs a year ago. Core inflation (excluding volatile food and energy costs) was measured at 2.9%. Services inflation, however, quickened from 4.0 to 4.2%, and it is a closely watched indicator by policymakers. The economic sentiment indicator for the euro area climbed from 96 in July to 96.6 in August, the strongest in more than a year. Although consumers were gloomier, confidence improved in the services sector. On the contrary, the business climate index for Germany as measured by the Ifo Institute dropped more than expected to 86.6 in August, its lowest level since February. Companies in Germany appear to be growing more pessimistic, prompting Ifo President Clemens Fuest to say, “The German economy is increasingly falling into crisis.”

Japanese stocks rose over this week, wrapping up a volatile month. The Nikkei 225 Index gained 0.7% while the broader TOPIX Index added 1.0%. Both the indexes lost in the steep sell-off around the start of the month, grounds which they mostly recovered by the month’s end. The deep dive was caused by the late July interest rate hike by the Bank of Japan (BoJ) and was further driven by renewed U.S. growth fears and the speedy unwinding of the yen carry trade. The latest inflation data reinforced a hawkish outlook on the BoJ’s monetary policy. A leading indicator of nationwide trends, the Tokyo-area core consumer price index (CPI) rose by 2.4% year-on-year in August, versus the consensus 2.2% and the highest since March. As the central bank gained confidence that the economy would stably achieve 2% inflation, BoJ Governor Kazuo Ueda reiterated that it would continue to normalize its monetary policy. This is an indication that the central bank is willing to raise interest rates again if its projections for the economy and prices materialize. BoJ Deputy Governor Ryozo Himino further stated that the baseline scenario for the future remains that growth and inflation will develop in line with the BoJ’s outlook. The yield on the 10-year Japanese government bond remained broadly unchanged at about 0.9%. The yen weakened to the high end of the JPY 144 against the USD range from JPY 144.35 at the end of the previous week.

China stocks fell over the week on the back of a series of disappointing corporate earnings reports that fell below expectations and dampened buying sentiment. The blue-chip CSI 300 lost 0.17% while the Shanghai Composite Index fell by 0.43%. The Hong Kong benchmark Hang Seng Index, on the other hand, gained by 2.14%. The country continued to deal with a prolonged property sector slump and weak domestic demand prompting some Chinese economists to reduce their 2024 growth forecasts. A key consumption indicator, retail sales, is estimated to grow by 4% this year, lower than the July estimate of 4.5%. Expected fixed asset investment, estimated during the prior month at 4.4%, is now projected to grow at 4.2%. The estimated consumer price index forecast previously at 0.6% has been trimmed to 0.5%. This sober outlook for China has raised the probability that the country may fall short of its official growth target of 5% in 2024. Speculations were also raised that the central bank may loosen its policy further in the short term, together with additional interest rate cuts. The reserve requirement ratio for domestic lenders may also be reduced.

The Week Ahead

The ISM Manufacturing PMI, job openings for July, and the nonfarm payrolls report for August are among the important economic releases expected in the coming week.

Key Topics to Watch

• S&P final U.S. manufacturing PMI for Aug.
• Construction spending for July
• ISM manufacturing for Aug.
• U.S. trade deficit for July
• Job openings for July
• Factory orders for July
• Fed Beige Book
• Auto sales for Aug.
• ADP employment for July
• Initial jobless claims for Aug. 31
• U.S. productivity (revision) for Q2
• S&P final U.S. services PMI for Aug.
• ISM services for Aug.
• U.S. employment report for Aug.
• U.S. unemployment rate for Aug.
• U.S. hourly wages for Aug.
• Hourly wages year over year
• New York Fed President Williams speaks (Sept, 6)
• Fed Gov. Christopher Waller speaks (Sept. 6)

Markets Index Wrap-Up

Stock Markets

Markets tread water throughout the week in anticipation of the Federal Reserve’s annual symposium in Jackson Hole, Wyoming, held from August 22 to 24. While there are typically no policy decisions made at this meeting, the Jackson Hole Symposium influences global financial markets. Expectations about interest rates and monetary policy are shaped by pronouncements by the Fed, particularly those articulated in Jackson Hole. The stock market has been fixated for a long time on the timeline of rate cuts, and the policymaking body has held its policy rate unchanged for more than a year. Fed Chair Powell’s speech on Friday suggests that officials perceive that the central bank’s dual mandate of stable inflation plus maximum employment has been sufficiently met to begin adjusting rates.

All major U.S. stock indexes are up for the week. The Dow Jones Industrial Average (DJIA) rose by 1.27% while the Total Stock Market Index outperformed by climbing 1.65% for the week. The S&P 500 Index advanced by 1.45% which is not far from the technology-heavy Nasdaq Stock Market Composite’s 1.40% gain. The NYSE Composite Index rose by 1.81% with all Russell components up. The CBOE Volatility Index (VIX), the indicator of investor risk perception, also went up by 7.16%. The rising stock market is therefore viewed as accompanied by rising volatility risk.

U.S. Economy

The economic news released this week came in mostly aligned with expectations and did little to move the markets. The S&P Global report on its first estimate of August economic activity confirmed that the manufacturing sector remained in a slump. It also confirmed, however, that the larger services sector continued at a healthy rate of expansion. Existing home sales rose slightly and in accordance with expectations, ending four months of straight declines. There was, however, the unexpected announcement by the Labor Department in its annual revision of its nonfarm payroll count through March. The estimates were revised downward by 818,000 jobs over the previous 12 months than were originally reported. The July jobs report was underwhelming because monthly hiring slowed and the unemployment rate inched up to its highest level since October 2021. A few weeks ago, this triggered recession worries and sparked the early August market drop. The recession panic seems to be overblown, and the data in recent weeks turned out to support a more positive outlook.

Metals and Mining

While gold ended last week above $2,500, it was uncertain if it would correct this week below that resistance level. Gold ended this week solidly above that level, making it a support level for the metal’s further upward movement. It is trading near record highs and signaling strongly that this latest rally is not over. There appears to be no signs of the market overheating albeit being hot, nor are there signs of frothy volatility that it may be approaching its peak. Gold seems to have plenty of room to rally as the Federal Reserve is just beginning a new easing cycle, according to analysts. The Fed dispelled any doubts that rates will be coming down in September. The minutes from the July monetary policy meeting indicated that several committee members were in favor of lowering the Fed Funds rate last month. This may negatively impact the U.S. dollar, rendering the USD index at a low for the year, breaking below 101 points. A weak dollar and low rates create a favorable situation for precious metals. Furthermore, other precious metals critical to the electrification of the global economy may turn bullish.

The spot prices of precious metals rose for the week. Gold modestly advanced by 0.18%, from its close last week at $2,508.01 to its close this week at $2,512.59 per troy ounce. Silver closed last week at $28.98 but ended this week at $29.82 per troy ounce for a gain of 2.90%. Platinum ended one week ago at $957.20 and this week at $965.62 per troy ounce, rising by 0.88%. Palladium ended this week at $964.30 per troy ounce, up 1.35% from its end last week at $951.48. The three-month LME prices of industrial metals were also up for the week. Copper, which ended last week at $9,115.50, closed this week at $9,288.50 per metric ton for a weekly gain of 1.90%. Aluminum last traded one week ago at $2,365.50 and this week at $2,542.00 per metric ton to register a gain of 7.46%. Zinc closed this week at $2,912.00 per metric ton, an increase of 5.41% over last week’s close at $2,762.50. Tin ended this week at $32,912.00 per metric ton for a 3.16% gain over last week’s close at $31,903.00.

Energy and Oil

This week, oil prices remained rangebound. The market appears to be recovering after the frenzy in the first two weeks of August. ICE Brent settled in a narrow band between $76 and $78 per barrel. After the US Federal Reserve’s July meeting notes indicated September would be the most probable date for the Fed interest rate cut, overall sentiment in the oil market has been improving. Macroeconomics might lift oil even higher if the Federal Reserve’s symposium at Jackson Hole does not disappoint.

In the meantime, a megamerger of two leading U.S. coal producers creates a new industry giant. Major coal producers Arch Resources and Consol Energy will merge in an all-stock deal to create a mining giant valued at more than $5 billion. It will boost an export capacity of 25 million tons per annum across two separate shipping terminals.

Natural Gas

For the report week beginning Wednesday, August 14 to Wednesday, August 21, 2024, the Henry Hub spot price fell by $0.05 from $2.17 per million British thermal units (MMBtu) to $2.12/MMBtu. Concerning Henry Hub futures, the price of the September 2024 NYMEX contract decreased by $0.042, from $2.219/MMBtu last Wednesday to $2.177/MMBtu yesterday. The price of the 12-month strip averaging September 2024 through August 2025 futures contracts declined by $0.041 to $2.978/MMBtu. At most locations, natural gas spot prices fell, ranging from a decrease of $0.47 at the Waha Hub in West Texas to an increase of $0.39 at Northwest Sumas on the Canada-Washington border.

International natural gas futures price changes were mixed this report week. The weekly average front-month futures prices for liquefied natural gas (LNG) cargoes in East Asia increased by $1.27/MMBtu to a weekly average of $13.90/MMBtu. Natural gas futures for delivery at the Title Transfer Facility (TTF) in the Netherlands, the most liquid natural gas market in Europe, decreased by $0.16 to a weekly average of $12.60/MMBtu. In the week last year that corresponds to this report week (beginning August 16 and ending August 23, 2023), the prices were $14.09/MMBtu in East Asia and 12.35/MMBtu at the TTF.

World Markets

The pan-European STOXX Europe 600 Index closed this week higher by 1.31% on the back of rising hopes for interest rate cuts by both the Fed and the European Central Bank (ECB) by September. The major continental stock indexes also closed higher. Italy’s FTSE MIB gained by 1.83%, France’s CAC 40 Index advanced by 1.71%, and Germany‘s DAX added 1.70% for the week. The UK’s FTSE 100 Index gained by 0.20%. Eurozone business activity was boosted by the Paris Olympics, although manufacturing is still shrinking. Eurozone business activity stalled in July but picked up in August, as suggested by the S&P Global purchasing managers’ index (PMI). The Olympic games in France drove the services sector to a four-month high, as the first estimate of the HCOB Eurozone Composite PMI Output Index came in at 51.2 from 50.2 (a reading greater than 50 signifies expansion). However, manufacturing production contracted for the 17^th consecutive month. According to the ECB, growth in negotiated wages in the eurozone (a key indicator for monetary authorities) slowed to 3.55% in the second quarter, down from 4.74% in the three preceding months. In its August report, the Bundesbank said that “the expected slow recovery in the [German] economy is being delayed further” by weak foreign demand.

Japan’s stock markets rose modestly for the week. The Nikkei 225 Index moved upward by 0.8% while the broader TOPIX Index inched up by 0.2%. Bank of Japan (BoJ) Governor Kazuo Ueda reiterated that the central bank would continue to normalize its monetary policy as it gains confidence that the economy may achieve 2% inflation in a stable manner, amid some speculation that recent market turmoil could discourage the Bank of Japan (BoJ) from further hiking interest rates. For the third straight month in July, core consumer price inflation accelerated, supporting the BoJ’s hawkish shift this year. The yen strengthened to the high end of the JPY 145 against the USD range from about JPY 147.6 at the end of the previous week, amid contrasting monetary policy outlooks for Japan and the U.S. The yield on the 10-year Japanese government bond rose from the prior week’s 0.88% to this week’s end at 0.90%.  the latest domestic inflation data was aligned with the BoJ’s conservative shift. The nationwide rate of core consumer price inflation climbed to 2.7% year-on-year from 2.6% in June, in line with expectations. The headline rate of inflation remained unchanged at 2.8% year-on-year. In terms of GDP growth and consumption, broader domestic data appear healthy.

Ahead of Fed Chair Powell’s Jackson Hole speech and on the back of a light economic calendar, Chinese stocks fell as buyers were kept on the sidelines. Both the Shanghai Composite and CSI 300 Indexes declined for the week, although the Hong Kong benchmark Hang Seng Index advanced. China’s central bank kept its benchmark lending rates unchanged on Monday, a reflection of policymakers’ intention to protect banks’ profit margins. The People’s Bank of China (PBOC) maintained the one-year loan prime rate at 3.35% and the five-year loan prime rate (LPR) at 3.85%. The LPR is a policy rate for mortgages and other long-term loans. After the bank unexpectedly trimmed several key rates in July, economists broadly expected the PBOC’s decision to remain steady on both LPRs. However, it is believed that there is room for further loosening in China this year should the Fed start cutting rates in the U.S. In earnings releases, the search engine leader Baidu’s second-quarter revenue came in lower than expected, even though earnings beat analysts’ forecast. Baidu, based in Beijing and often referred to as China’s Google, reported that second-quarter revenue ending June dropped by 0.4%.

The Week Ahead

Among the important economic releases scheduled in the coming week are personal income and spending for July, the second quarter GDP, and July inflation data.

Key Topics to Watch

• Durable-goods orders for July
• Durable-goods minus transportation for July
• San Francisco Fed President Daly TV interview (August 26)
• S&P Case-Shiller home price index (20 cities) for June
• Consumer confidence for Aug.
• Atlanta Fed President Raphael Bostic speech (August 28)
• Initial jobless claims for Aug. 24
• Advanced U.S. trade balance in goods for July
• Advanced retail inventories for July
• Advanced wholesale inventories for July
• GDP (2nd revision) for Q2
• Pending home sales for July
• Atlanta Fed President Raphael Bostic speech (August 29)
• Personal income (nominal) for July
• Personal spending (nominal) for July
• PCE index (for) July
• PCE (year-over-year)
• Core PCE index for July
• Core PCE (year-over-year)
• Chicago Business Barometer (PMI) for Aug.
• Consumer sentiment (final) for Aug.

Markets Index Wrap-Up