Commentary
Last week, global equity markets experienced a decline, with the exception of US small-caps and value stocks. In terms of sectors, technology was the weakest performer, with S&P 500 tech sector declining by 5.5%. This was mainly due to a decline in semiconductor stocks, which is attributed to potential new restriction on chip exports from US to China.
Meanwhile, macroeconomic data from the US painted a generally positive picture. Retail sales experienced an uptick, indicating robust consumer spending. This increase was seen as a sign of economic resilience, supporting the view that the economy is continuing to grow despite inflationary pressures. Additionally, industrial production also saw a rise, further bolstering the positive sentiment around the manufacturing sector.
In Europe, the European Central Bank kept the interest rates unchanged, signaling a cautious approach amid economic uncertainty. The region’s industrial production data revealed a decline, reflecting ongoing challenges in the manufacturing sector. Despite this, there was an observed increase in loan demand, which suggested that businesses and consumers were still seeking credit, possibly in anticipation of economic improvement.
