Highlights
Global markets ended the week on a cautiously optimistic note as easing oil prices and hopes of progress in US-Iran negotiations supported risk sentiment. US equities advanced on strong earnings expectations and AI optimism, while European markets were mixed. Bond yields remained elevated amid persistent inflation concerns and expectations of further monetary tightening, particularly in the UK. The US dollar extended its rally to a fourth consecutive week, while the yen weakened further. Meanwhile, gold gained as investors balanced easing oil prices against ongoing geopolitical and inflationary risks. Overall, markets remained caught between improving sentiment and the prospect of higher-for-longer interest rates.
Data Highlights
In Canada, the unemployment rate rose 10bps to 6.5% in September, matching expectations. In the U.S., the ISM Services PMI fell sharply to 53.9 in September, well below the softer consensus of 55.0, while ADP Weekly Employment Change rose by 3.75K to 23.75K. Initial jobless claims declined by 2K to 197K, defying consensus expectations of a 1K increase to 200K, while continuing jobless claims rose by 17K to 1,716K, exceeding the forecast of 1,710K. Switzerland’s unemployment rate held steady at 3.0%, higher than the 2.8% consensus. In the Eurozone, retail sales rose 0.1% month-on-month in August, slightly below the 0.2% forecast, while year-on-year retail sales grew 0.8%, also trailing the 1.0% consensus.
Week Ahead
India Inflation Rate YoY (Sep) – Monday | U.K. BRC Retail Sales Monitor YoY (Sep), U.S. ADP Employment Change Weekly, U.S. Existing Home Sales (Sep) – Tuesday | China Inflation Rate YoY (Sep), U.S. CPI (Sep), U.S. Inflation Rate YoY (Sep), U.S. Core Inflation Rate YoY (Sep) – Wednesday | Australia Unemployment Rate (Sep), U.K. GDP MoM (Aug), U.S. Initial Jobless Claims (Oct/10), U.S. Continuing Jobless Claims (Oct/03), U.S. PPI MoM (Sep), U.S. Retail Sales YoY (Sep) – Thursday | Eurozone CPI (Sep) – Friday
