US equities slipped Friday and were down for the week, as investors fretted over historically high Treasury yields, surging oil prices, and a Federal Reserve that looks unlikely to drive relief from its aggressive interest rate policy anytime soon. The S&P 500 Index was down 0.2% on Friday and 2.9% for the week and closed at the lowest level since mid-June. Meantime, the Dow Jones Industrial Average and the Nasdaq Composite slipped 0.3% and 0.1%, respectively on Friday and were down 1.9% and 3.6% for the week. The past week was particularly rough for smaller companies and other parts of the market considered to have exposure to recession risks. Elsewhere, European shares lost 1.5% for the week, the most since mid-August, on worries over higher-for-longer rates.  

Summary for 25.09.2023 

  • Asian shares fell on Monday, dragged by China after central banks last week reinforced the message that interest rates would stay higher for longer, while investors braced for inflation data from the US and Europe. Markets will be looking for clues on whether China’s economy is regaining traction, with a week-long national holiday set to begin on Friday that will be a key test for consumer spending. Meanwhile, Japanese shares gained as the Bank of Japan’s commitment to ultra-loose monetary policy and a weak yen kept domestic equities supported. 
  • European shares are set to extend their losing streak with interest rate concerns remaining in focus. On the other side of the Atlantic, US equity futures edged higher on Monday as the market looked to recoup some losses as it entered the last trading week of September. 
  • Oil prices rose for a second day on Monday as hedge funds piled on bets that tightening supplies will see a resumption of the rally after a pause last week. Hedge funds boosted their bullish positions on West Texas Intermediate to the highest since February 2022 on the back of higher prices and easing volatility, while JPMorgan added to predictions of an “oil supercycle.”  
  • Hollywood’s writers’ union reached a preliminary labour agreement with major studios on Sunday, a deal expected to end one of two strikes that have halted most film and television production and cost the California economy billions. The three-year contract still must be approved by the leadership of the Writers Guild of America (WGA), as well as union members, before it can take effect. The WGS, which represents 11,500 fil and television writers, described the deal as “exceptional” with “meaningful gains and protections for writers.” 
  • Activision Blizzard rose 1.7% on Friday after reports suggesting Microsoft’s restructured deal to acquire the video game publisher had resolved antitrust concerns raised by UK regulators. Microsoft was down 0.7%. 
  • Ford shares rose more than 2% Friday after CNBC reported the automaker was making headway in negotiations with the United Auto Workers union as its strike continues. Other auto shares were mixed, with Stellantis up 0.4% and General Motors shares down slightly. 
  • Dutch banks ING Groep NV and ABN AMRO Bank NV dropped 6.4% and 4.5%, respectively on Friday, after a majority of the Dutch parliament’s second chamber approved a proposal to increase bank taxes. 
  • After a week filled with central bank meetings, attention will once again shift to macroeconomic data. In the US, the spotlight will be on the PCE Price Index, as well as personal income and spending data. Additionally, the focus will be directed toward durable goods orders, the final reading of the Q2 GDP growth rate, and pending and new home sales. In Europe, September inflation rates will be released for the Euro Area, Germany, France, Italy, and Spain. Finally, investors are set to monitor Ifo Business Climate, GFK Consumer Confidence, and retail sales figures for Germany, along with industrial production, retail sales, the unemployment rate, consumer confidence, and the BoJ Monetary Policy Meeting Minutes in Japan.