Market Monitor – 2 June 2023
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Market Monitor – 2 June 2023

Global stock markets managed to recover some of their early-week losses on Thursday following signs that the United States Congress was likely to approve a rise in the government debt ceiling after weeks of increasingly fraught negotiations

Worries that the House of Representatives could block the agreement struck between President Biden and House speaker Kevin McCarthy last weekend added to volatility on Monday and Tuesday, before nerves were calmed by the House’s green light on Wednesday. While the deal still requires ratification by the Senate, this is thought to be more of a formality. Elsewhere, mixed economic news in America and China added to concerns about global growth, although there were encouraging indications from Europe that inflation was starting to slow.

United States

On Wall Street, the Dow Jones Industrial Average ended trading on Thursday 0.1% down for the week so far, with the S&P 500 gaining 0.4%. As well as an apparent resolution to the debt ceiling standoff, investors in the US welcomed ongoing strength in technology stocks – particularly those with some form of exposure to artificial intelligence. Signs towards the end of the week that wage inflation was beginning to ease also raised hopes that the Federal Reserve would pause its recent run of interest-rate hikes in June and possibly July.

UK

In the UK, the FTSE 100 closed on Thursday down 1.8% up for the week so far, with weakness in commodities and oil companies weighing on the index as concerns about a global slowdown intensified. Problems in Britain’s property sector continued with new data showing a slump in home sales and a sharp decline in mortgage lending on the back of recent interest-rate rises. UK factory output, meanwhile, has reportedly been held back by the post-Brexit checks introduced in recent months.

Europe

In Frankfurt, the DAX index ended Thursday’s session down 0.8% for the week, while France’s CAC 40 fell 2.5%. Losses were particularly acute earlier this week on concerns about the US debt crisis as well as slowing growth in China – a major trading partner for German and French firms alike. However, spirits were lifted by eurozone inflation data published on Thursday which showed the rate of price rises in the bloc had fallen to its lowest level since the Russian invasion of Ukraine in February last year.

Asia

In Asia, the Hang Seng index in Hong Kong dipped 2.8%, extending its recent losses as fresh data suggested China was struggling to maintain its post-Covid recovery. Official figures indicated that the country’s service sector had contracted for a fourth consecutive month while factory output fell unexpectedly in May. Japan’s Nikkei 225 index of leading shares advanced 0.7%, having hit its highest level since 1990 on Monday. A rise in retail sales and a healthy outlook for Japanese government finances underpinned the latest gains.

26 May
1 June
Change (%)
FTSE 100
7627.2
7490.3
-1.8
FTSE 250
18794.1
18827.8
0.2
S&P 500
4205.5
4221.0
0.4
Dow Jones
33093.3
33061.6
-0.1
DAX
15984.0
15853.7
-0.8
CAC 40
7319.2
7137.0
-2.5
ACWI
653.1
653.0
0.0
Hong Kong Hang Seng
18746.9
18216.9
-2.8
Nikkei 225
30916.3
31148.0
0.7

Note: all market data contained within the article is sourced from Bloomberg unless stated otherwise, data as at 1 June 2023.

2 June 2023
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Market Monitor – 2 June 2023

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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