The U.S. market is closed today for ‘Labor Day’ which traditionally brings an end to the summer holiday season. Trading volumes are likely to trend upwards from this point and it will be interesting to see if this is a September to remember for markets. October and September rank 1st and 2nd respectively in terms of largest average monthly moves for the stock market so far this century. What does this tell us about the rest of 2021? Probably very little, if anything at all. However, as the Federal Reserve continues to plot its monetary policy course, economic data becomes more subjective (see below regarding the U.S. jobs report), and the Delta variant remains stubbornly present, there will continue to be opportunities abound for good active investment management.
A little closer to home, the CSO reported last week that the Irish population is above 5 million for the first time since the 1840s. Dublin’s population is also growing at the 4th fastest rate for a European capital. Finally, there are now 740,300 people above the age of 65 in Ireland – an increase of just short of 18% since 2016.
As always, if you wish to discuss anything in this newsletter in further detail, please do get in touch.
Weekly Investment News
U.S. stocks hit fresh highs on Thursday afternoon before somewhat limping into the weekend on the back of the monthly non-farm payrolls jobs data. Just 235,000 jobs were added in August versus a consensus expectation of 750,000 – a miss of over half a million. On the other hand, previous releases were revised upwards and the unemployment rate ticked down further to 5.2%. Most commentators pointed to supply issues rather than a lack of employer demand, an opinion supported by the NFIB small business survey which showed that the percentage of businesses reporting that jobs were hard to fill rising to a record high in August. Weekly jobless claims were also down to their lowest level since March 2020 with average hourly earnings jumping 0.6%. The slew of data left much to be digested, as the weaker report may slightly stall the Federal Reserve’s tapering plans. Finally from the U.S., Hurricane IDA battered the east coast, with a number of areas including New York seeing substantial flooding. The final human cost is still being counted, with the economic impact likely to be seen in data in the coming months.
Chinese data pointed towards a continuing slowdown in the world’s second biggest economy, with the manufacturing PMI falling to 50.1 and the services reading dropping further into contraction territory. However, Chinese stocks were higher for the second week in a row following their large falls in August. Japanese equities were also higher as the market reacted positively to the news that Prime Minister Suga will resign, prompting speculation of further economic stimulus. Eurozone stocks were broadly flat as inflation in August hit the highest level in ten years, bringing some hawkish comments from some policymakers. The ECB meet later this week, whilst no change is expected, the accompanying commentary will be closely analysed for any potential shifts in future policy. CLICK HERE