Providing you with a short summary of events from around the world. ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

Blackfinch Group
Monday Market Update

The ever-changing world we live in reinforces the importance
of regular up-to-date communication. This weekly news update from our
multi-asset portfolio managers provides you with a summary of global events
 for your reference and to share with clients.

Issue 115 | 24th October, 2022

UK COMMENTARY

  • The Office for National Statistics (ONS) reported that core inflation – which strips out volatile components such as food, energy, alcohol and tobacco – jumped to a 30-year high of 6.5% in September.
  • Including these volatile components resulted in Consumer Price Index (CPI) inflation increasing to 10.1% in September, returning to double digits after a slight dip to 9.9% in August.
  • Food and drink price inflation hit its highest level since April 1980. Food and non-alcoholic beverage prices rose 14.5% over the last year, up from 13.1% in August.
  • UK residential transactions fell 32% to 112,370 in September year-on-year, according to HM Revenue & Customs. It cautioned that the recent sharp rises in mortgage rates which followed the 23 September ‘mini-budget’  had not fed through to the figures yet.
  • The ONS reported UK average house prices increased by 13.6% over the year to August, down from 16.0% in July. The average UK house price was £296,000 in August 2022, which was £36,000 higher than this time last year.

NORTH AMERICA COMMENTARY

  • US housing starts – an important measure of new residential construction –were weaker than expected in September, according to government data. New starts declined 8.1% to a seasonally-adjusted annual rate of 1.439mn. Building permits, which are the more forward-looking gauge of housing construction, rose 1.4%, but the gain was all in the volatile multi-family sector.
  • Industrial production was surprisingly positive in September with a 0.4% advance, according to the US Federal Reserve. Manufacturing was the major source of the strength, rising 0.4% on stronger durables and non-durables activity.
  • The preliminary October reading of the University of Michigan's Consumer Sentiment Index rose 1.2 points to 59.8, the fourth consecutive monthly advance after hitting an historical low of 50 in June. The index of current economic conditions rose 5.6 points to 65.3, but the expectations component fell 1.8 points to 56.2.

EUROPE COMMENTARY

  • Eurostat reported that Eurozone industrial production rose 1.5% month-on-month in August, partially rebounding from the 2.3% contraction in July. Importantly, the expansion was relatively broad-based with most geographies and product categories posting solid rises over the month. German industry was a notable exception as it underperformed due to being disproportionately hit by the energy crisis.
  • S&P Global’s Eurozone composite Purchasing Managers’ Index (PMI) fell to 48.1 in September, down 0.1 points from its flash estimate and 0.8 points lower than August as both industrial and services activity weakened. Services sector PMI fell to 48.8 in September, down from August’s 49.8 and the lowest level since February 2021. These measures indicate gross domestic product (GDP) is already contracting in the region.

EMERGING MARKETS COMMENTARY

  • Chinese third quarter GDP grew 3.9% year-on-year, which implied seasonally-adjusted quarter-on-quarter growth of 3.7%, beating the market consensus and analyst expectations. The growth rebound followed a very weak second quarter, and was driven largely by final consumption expenditure, which contributed 2.1% to annual growth.

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