Got only 15 seconds? Here’s a succinct summary of major global events that transpired last week.
Positives
- U.S. equities rallied to close at a record high
- Australia’s stock market neared a decade high
Negatives
- Singapore economy posts its slowest growth rate in a decade
- China’s June export figures see a decline due to trade tensions
Now, for more detail.
Positives
1. U.S. equities rallied to close at a record high
What You Should Know
The U.S. equity market rose to record highs this week. The S&P 500 crossed the 3,000 threshold while the Dow Jones Industrial Average surpassed 27,000. Among the gainers were the Financial and Technology sectors while Communications and Real Estate were the lagged behind.
What You Should Lookout For
Fed Chairman Jerome Powell suggests there is room to cut interest rates to stimulate the economy in times of global slowdown. Earnings season is nearing with quarterly corporate reports set to begin next week.
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Stocks Hit Record at Close as Treasuries Retreat: Markets Wrap
2. Australia’s stock market neared a decade high
What You Should Know
Australia’s stock rally neared record highs this week with the Australia benchmark S&P/ASX 200 Index being just 2 percent away from a fresh record. The benchmark surged over 18 per cent this year, adding about USD 210 billion in value.
What You Should Lookout For
The country’s monetary policy easing drove the equities higher as the Reserve Bank of Australia reduced interest rates both in June and July, and are set for further reductions in the coming months. The rally was led by sectors such as Communication, Technology, Media and Financial firms. The next catalyst is expected to be the upcoming earnings session next month.
Suggested Reading:
Australia’s $302 billion stock rally nears a record high, but the future is cloudy
Negatives
1. Singapore economy posts its slowest growth rate in a decade
What You Should Know
According to Singapore’s Ministry of Trade and Industry, the Singapore economy shrank by 3.4 percent in the second quarter of this year, falling down to an annual growth rate of just 0.1 percent.
What You Should Lookout For
Singapore has been impacted by the dual forces of the regional economic slowdown and the US-China trade war. The country’s supply of high-tech exports to Asia has been disrupted by the growing trade tensions. Lacklustre economic data raises possibilities of the country going easy on its monetary policy in the future.
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Singapore’s economy experiences slowest growth in a decade
2. China’s June export figures see a decline due to trade tensions
What You Should Know
Chinese exports have slowed down as a result of rising trade tensions between the world’s two largest economies. Chinese exports declined 1.3 percent year-on-year in dollar terms according to Chinese official data released this week. Value of imports into the country also fell, reflecting the local manufacturer’s caution while buying raw material. As a result, while the exports have declined, China’s trade surplus with the U.S. has risen.
What You Should Lookout For
The softer figures are a consequence of the U.S.-China trade friction. Low expectations are here to stay for a while given headwinds such as global growth slowdown.