Commentary: mixed signals
Global equities experienced modest growth last week in the face of mixed signals regarding the economy and monetary policy. Overall, growth stocks outperformed their value peers, partly pushed by strong earnings beat by NVIDIA.
Importantly, earnings commentaries from the US retailers, such as Macy’s, Dollar Tree, and Nordstrom, show signs that the US consumer may be weakening. Macy’s and Nordstrom observed rising delinquencies and late payments, while Macy’s is also facing a diminishing demand. Meanwhile, Dollar Tree and Dick’s Sporting Goods have reported significantly elevated levels of theft in their stores.
In Europe, the preliminary PMI figures suggest that Euro Area business activity is fading. While manufacturing activity seems to have contracted for the sixth month, services sector has entered a contraction zone (below-50 area) for the first time since December 2022.
