Market Monitor – 19 April 2024
Insights

Market Monitor – 19 April 2024

A miserable month for global stock markets continued this week, with geopolitical concerns and further indications that central banks will be slow to cut interest rates adding to negative sentiment.

Last weekend’s drone and missile attack on Israel by Iran was the latest sign of escalation of the conflict in the Middle East, and investors began the week worried about how Israel would respond. The International Monetary Fund (IMF) warned that a spike in the price of oil could cause a serious shock for the global economy, similar to that seen following Russia’s invasion of Ukraine in early 2022. However, while crude prices rose sharply at the start of the week, they fell back as Israel’s allies urged the country to be measured in its response. Strong economic data in the US and parts of Europe, meanwhile, have made interest rate cuts in the first half of 2024 increasingly unlikely, although upbeat first-quarter trading statements from a number of major corporations have given investors something to cheer in an otherwise gloomy week.

United States

On Wall Street, the Dow Jones Industrial Average ended trading on Thursday 0.5% down for the week so far, with the S&P 500 falling 2.2%. Once again, solid economic data in the US has translated into bad news for equities as the chances of the Federal Reserve relaxing monetary policy in the next few months recede. Unexpectedly strong retail sales numbers on Monday were followed by the IMF forecasting 2.7% GDP growth for the American economy this year – by far the highest rate among the G7 nations. The US employment market, meanwhile, shows no sign of being hampered by high borrowing costs. Strong quarterly earnings reports from the banking and technology sector were welcomed, although there were concerns about the outlook for one of the country’s most valuable car manufacturers after it announced major restructuring plans.

UK

In the UK, the FTSE 100 fell back from last week’s highs, and the index closed on Thursday 1.5% lower for the week so far after the declining oil price hit London’s major energy stocks. March’s inflation figure, meanwhile, came in higher than expected as a result of higher fuel costs, with the consumer prices index falling to 3.2% rather than the forecast 3.1%. The news makes it less likely the Bank of England will cut rates before the summer, and by Thursday markets were not pricing in a first reduction until November. Equally worryingly, a fall in the UK employment rate, in particular the ongoing rise in the number of people described as “economically inactive”, raised questions about future growth and productivity in Britain.

Europe

In Frankfurt, the DAX index ended Thursday’s session down 0.4% for the week, although France’s CAC 40 bucked the global trend and edged 0.2% ahead. Economic data in the eurozone remains weak but broadly positive, with industrial production up in March but still at a significantly lower level than 12 months ago. While Germany’s Bundesbank thinks the country’s economy emerged from recession in the first three months of the year, the IMF is forecasting growth of just 0.2% for 2024. Sentiment was also hit by an update from one of Europe’s biggest semiconductor companies that was more pessimistic than expected.

Asia

In Asia, the Hang Seng index in Hong Kong fell 2% as the latest economic data from China showed a possible slowdown in activity in March following a relatively strong start to the year. Japan’s Nikkei 225 index of leading shares, meanwhile, fell 3.7% as the possibility of Bank of Japan intervention to support the weakening yen weighed on the market. Shares in Tokyo were also hit by news of falling business confidence and the weaker outlook from a major European microchip company.

April 12
April 18
Change (%)
FTSE 100
7995.6
7877.1
-1.5
FTSE 250
19721.2
19450.7
-1.4
S&P 500
5123.4
5011.1
-2.2
Dow Jones
37983.2
37775.4
-0.5
DAX
17930.3
17850.8
-0.4
CAC 40
8010.8
8023.3
0.2
ACWI
765.7
749.4
-2.1
Hong Kong Hang Seng
16721.7
16385.9
-2.0
Nikkei 225
39523.6
38079.7
-3.7

Note: all market data contained within the article is sourced from Bloomberg unless stated otherwise, data as at 18 April 2024.

19 April 2024
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Market Monitor – 19 April 2024

Important information

For marketing purposes.

This document is intended for informational purposes only and should not be considered representative of any particular investment. This should not be considered an offer or solicitation to buy or sell any securities or other financial instruments, or to provide investment advice or services. Investing involves risk including the risk of loss of principal. Your capital is at risk. Market risk may affect a single issuer, sector of the economy, industry or the market as a whole. The value of investments is not guaranteed, and therefore an investor may not get back the amount invested. International investing involves certain risks and volatility due to potential political, economic or currency fluctuations and different financial and accounting standards. The securities included herein are for illustrative purposes only, subject to change and should not be construed as a recommendation to buy or sell. Securities discussed may or may not prove profitable. The views expressed are as of the date given, may change as market or other conditions change and may differ from views expressed by other Columbia Threadneedle Investments (Columbia Threadneedle) associates or affiliates. Actual investments or investment decisions made by Columbia Threadneedle and its affiliates, whether for its own account or on behalf of clients, may not necessarily reflect the views expressed. This information is not intended to provide investment advice and does not take into consideration individual investor circumstances. Investment decisions should always be made based on an investor’s specific financial needs, objectives, goals, time horizon and risk tolerance. Asset classes described may not be suitable for all investors. Past performance does not guarantee future results, and no forecast should be considered a guarantee either. Information and opinions provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed. This document and its contents have not been reviewed by any regulatory authority.

 

In the UK: Issued by Threadneedle Asset Management Limited, registered in England and Wales, No. 573204. Registered Office: Cannon Place, 78 Cannon Street, London EC4N 6AG. Authorised and regulated in the UK by the Financial Conduct Authority.

 

In Australia: Issued by Threadneedle Investments Singapore (Pte.) Limited [“TIS”], ARBN 600 027 414.  TIS is exempt from the requirement to hold an Australian financial services licence under the Corporations Act 2001 (Cth) and relies on Class Order 03/1102 in respect of the financial services it provides to wholesale clients in Australia. This document should only be distributed in Australia to “wholesale clients” as defined in Section 761G of the Corporations Act. TIS is regulated in Singapore (Registration number: 201101559W) by the Monetary Authority of Singapore under the Securities and Futures Act (Chapter 289), which differ from Australian laws.

 

In Singapore: Issued by Threadneedle Investments Singapore (Pte.) Limited, 3 Killiney Road, #07-07, Winsland House 1, Singapore 239519, which is regulated in Singapore by the Monetary Authority of Singapore under the Securities and Futures Act (Chapter 289). Registration number: 201101559W. This advertisement has not been reviewed by the Monetary Authority of Singapore.

 

In Hong Kong: Issued by Threadneedle Portfolio Services Hong Kong Limited 天利投資管理香港有限公司. Unit 3004, Two Exchange Square, 8 Connaught Place, Hong Kong, which is licensed by the Securities and Futures Commission (“SFC”) to conduct Type 1 regulated activities (CE:AQA779). Registered in Hong Kong under the Companies Ordinance (Chapter 622), No. 1173058.

 

Columbia Threadneedle Investments is the global brand name of the Columbia and Threadneedle group of companies.

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Important information

For marketing purposes.

This document is intended for informational purposes only and should not be considered representative of any particular investment. This should not be considered an offer or solicitation to buy or sell any securities or other financial instruments, or to provide investment advice or services. Investing involves risk including the risk of loss of principal. Your capital is at risk. Market risk may affect a single issuer, sector of the economy, industry or the market as a whole. The value of investments is not guaranteed, and therefore an investor may not get back the amount invested. International investing involves certain risks and volatility due to potential political, economic or currency fluctuations and different financial and accounting standards. The securities included herein are for illustrative purposes only, subject to change and should not be construed as a recommendation to buy or sell. Securities discussed may or may not prove profitable. The views expressed are as of the date given, may change as market or other conditions change and may differ from views expressed by other Columbia Threadneedle Investments (Columbia Threadneedle) associates or affiliates. Actual investments or investment decisions made by Columbia Threadneedle and its affiliates, whether for its own account or on behalf of clients, may not necessarily reflect the views expressed. This information is not intended to provide investment advice and does not take into consideration individual investor circumstances. Investment decisions should always be made based on an investor’s specific financial needs, objectives, goals, time horizon and risk tolerance. Asset classes described may not be suitable for all investors. Past performance does not guarantee future results, and no forecast should be considered a guarantee either. Information and opinions provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed. This document and its contents have not been reviewed by any regulatory authority.

 

In the UK: Issued by Threadneedle Asset Management Limited, registered in England and Wales, No. 573204. Registered Office: Cannon Place, 78 Cannon Street, London EC4N 6AG. Authorised and regulated in the UK by the Financial Conduct Authority.

 

In Australia: Issued by Threadneedle Investments Singapore (Pte.) Limited [“TIS”], ARBN 600 027 414.  TIS is exempt from the requirement to hold an Australian financial services licence under the Corporations Act 2001 (Cth) and relies on Class Order 03/1102 in respect of the financial services it provides to wholesale clients in Australia. This document should only be distributed in Australia to “wholesale clients” as defined in Section 761G of the Corporations Act. TIS is regulated in Singapore (Registration number: 201101559W) by the Monetary Authority of Singapore under the Securities and Futures Act (Chapter 289), which differ from Australian laws.

 

In Singapore: Issued by Threadneedle Investments Singapore (Pte.) Limited, 3 Killiney Road, #07-07, Winsland House 1, Singapore 239519, which is regulated in Singapore by the Monetary Authority of Singapore under the Securities and Futures Act (Chapter 289). Registration number: 201101559W. This advertisement has not been reviewed by the Monetary Authority of Singapore.

 

In Hong Kong: Issued by Threadneedle Portfolio Services Hong Kong Limited 天利投資管理香港有限公司. Unit 3004, Two Exchange Square, 8 Connaught Place, Hong Kong, which is licensed by the Securities and Futures Commission (“SFC”) to conduct Type 1 regulated activities (CE:AQA779). Registered in Hong Kong under the Companies Ordinance (Chapter 622), No. 1173058.

 

Columbia Threadneedle Investments is the global brand name of the Columbia and Threadneedle group of companies.

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