For the last week of September, investors switched into risk-off mode while the Federal Reserve reiterated its confidence in the strength of the U.S. economy. As expected, it raised interest rates for the third time this year.
Most stock markets (with the exception of Japan) and the EUR were going down as the Italian Government on Thursday targeted the budget deficit at 2.4 percent of GDP for the next three years (compared with 2.8 percent for France), thereby defying the European Commission.
The financial sector was hit hard. Political and fiscal worries in Europe led to new inflows into U.S. Treasuries, pushing their yield a bit lower and putting pressure on banks. By contrast, the energy sector continued its winning streak ahead of U.S. sanctions against Iran, oil prices surging to four-year highs (almost +10 percent in only three weeks) though Trump blasted OPEC, accusing them of ‘ripping off the rest of the world’. In the same vein, the tech sector was boosted by Apple, after the overweight rating provided by JP Morgan, and Amazon, after a sell-side firm upped the share price target from $2,020 to $2,525. This bullish trend was not impacted by the new security breach affecting 50 million Facebook user accounts.
Find the full report here : https://www.trackinsight.com/weekly-flow-report/2018-09-28/global
