Week from 11 to 17 November 2019
U.S. large cap indices posted their sixth straight week of gains (S&P500: +0.89%, Nasdaq: +0.77%, DJIA: +1.17%), setting new closing and intraday highs, as they were bolstered by renewed optimism over U.S.-China trade talks. White House economic adviser Larry Kudlow said late on Thursday that the United States and China are getting close to a trade agreement.
Overall, Europe also finished a bit higher (EuroStoxx50: +0.32%), thereby securing its longest winning streak of the year, even though the German economy managed to avoid a recession in the third quarter (+0.1% growth rate) and automotive companies are still awaiting U.S. President Donald Trump’s decision on whether or not his administration is to impose up to 25% tariffs on European cars.
After five positive weeks, it was a tougher period in Asia, especially in China (Nikkei slipping 0.38%, Shangai Composite down 2.46%).
Among the S&P sectors, healthcare (+2.42%) led the pack in the wake of health-insurance giants (Humana and Anthem stocks soaring 5.66% and 5.58% WTD respectively). It’s also worth noting that the losers in the past few weeks gradually recovered (real estate up 1.93%, utilities up 1.53%). Tech shares (+1.31% WTD) were also an important driver of the market, with the semiconductor industry boosted by Applied Materials after the chip gear maker forecast first-quarter revenue and profit significantly above analysts’ estimates.
By contrast, consumer discretionary (-0.24%), financials (-0.26%) and energy (-1.28% though WTI crude futures moved up 48 cents to $57.72 a barrel) lagged behind.
Treasuries were in demand with yields on U.S. 10-year notes dropping to 1.84% and away from last week’s three-month top of 1.97%. Same trend in Europe with the 10-year Bund sliding to -0.33% and the French 10-year OAT flipping again to negative territory and trading at minus 2bps. IG corporate bonds partly recouped the losses suffered last week (+0.61% WTD in the U.S. vs. -1.19% a week ago) while high yield and emerging bonds were edging down (-0.04% and -0.30% respectively).
Lastly, gold rose 0.38% on the week.
Find the full report here: https://www.trackinsight.com/weekly-flow-report/2019-11-15/global