The war in Ukraine has tended to increase uncertainty regarding inflation and growth prospects. When and with what consequences this war will end is pure speculation, but capital markets are expected to build a certain immunity to the headline risks in the coming weeks. The medium- to long-term consequences, on the other hand, could be significant. It is possible that we are at the beginning of a new bloc formation or a new Cold War. This would put a significant damper on globalization and further fuel higher structural inflation.
US equities ended the day higher as the markets await some key data later this week and amid some likely caution ahead of today’s midterm elections. The Dow Jones Industrial Average rose 1.3%, the S&P 500 increased 1.0%, and the Nasdaq Composite advanced 0.9%. Across the Atlantic, European bourses ended the day mixed as investors digested some earnings and economic data to begin the week.
- Asian equity markets were mixed on Tuesday as investors continue to watch for policy signals about China’s zero-Covid strategy. Shares in Australia, Japan and South Korea all finished in positive territory, while mainland China and Hong Kong equities consolidated recent gains.
- European and US equity futures are trading flat this morning ahead of US midterm elections and an inflation print coming later this week.
- US consumers borrowed $25.0 billion in September, below the $30.0 billion forecast, while August’s figure was adjusted downward to $30.2 billion from the originally reported $32.2 billion read.
- Retail sales in the United Kingdom increased by 1.2% on a like-for-like basis in October from a year ago, slowing from September’s 1.8% gain as consumers continue to grapple with the rising cost of living.
- Apple announced on Monday that although it continues to see strong demand for its iPhone 14 Pro and 14 Pro Max, it expects lower shipments of the models than previously expected and customers will experience longer wait times to receive their new products. The company said Covid-19 restrictions in China have temporarily impacted its primary assembly facility in the region and it is currently operating at a significantly reduced capacity.
- Former US President Donald Trump said yesterday he would be making a big announcement next week at his Mar-a-Lago estate in Florida, his strongest indication yet that he will mount a widely anticipated third White House bid.