Weekly Market Insight

Latest Economic & Market Update 5th October 2020

05th October 2020

Good afternoon, it is October 5th 2020 and here is your economic and market update from BlackBee. 

Today’s focus:

  • Tech stocks led declines on Friday
  • Job market recovery in US slows

US stocks climbed on the back of fresh hope of a new fiscal stimulus deal on Wednesday. The S&P500 climbed 0.83%, the Nasdaq moved 0.74% higher and the Dow Jones increased 1.2%. Despite gains in the final day of the month, US Indices recorded their first monthly fall since March as the S&P500 declined -3.92%, the Dow Jones fell -2.28% and the Nasdaq recorded a -5.16% decline in September. The Stoxx Europe 600 retreated -0.11% on Wednesday.

Bloomberg reported that in another attempt to reach a new fiscal stimulus package, Steve Mnuchin, US Treasury Secretary, and House Speaker Nancy Pelosi met on Wednesday for negotiations. These fresh negotiations has increased hope that a deal can still be achieved following months of stalemate. Mnuchin suggested that he would offer a $1.5 trillion proposal which is both less than the $2.2 trillion that the Democrats proposed but higher than what some Senate Republicans have said they would support. Following the announcement that Disney would cut 28,000 jobs in US theme parks, accompanied by further concern of layoffs in the airline industry, the need for a fiscal stimulus deal to be reached was reignited again.

According to a Property Report by MyHome.ie, the quarterly national house asking price inflation rose by 5.2% in Q3 2020. For Q2 2020 asking price inflation was -2.9%. This is the highest level since Q1 2017. The report noted that as a result of the suspension of construction, supply is down 25% from the same period in 2019. Angela Keegan the Managing Director of MyHome.ie stated that the driving factors behind the increase in inflation is the increased demand and lower supply. This further supports the argument for the government to provide extra funding for social and affordable housing as supply levels stand much lower than the same period last year.

Data source: Bloomberg

Best & Worst Performers of Large Cap US Stocks on Friday
Click image to enlarge

Global Market Update
(as at close of markets 02/10/2020)