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Monthly viewpoint

Caspar Rock: Monday markets - the week ahead on 28 October


Caspar Rock

Caspar Rock

Chief Investment Officer

The EU has agreed to a three month Brexit extension. The UK Parliament will now vote on whether to hold a general election in December. 

Equities rallied last week thanks in part to better than expected earnings reports. Companies have generally been echoing what we have seen in macroeconomic data, with weaker performance in manufacturing and stronger performance in services. Economic data releases also indicated a slight pick-up in US activity.  

Another US interest rate cut is widely expected at this week’s Federal Reserve meeting. Markets will be more focused on clues about the outlook for US monetary policy in 2020.

Estimates of third-quarter GDP will also be released this week. In the US, we expect to see slower growth than in recent quarters. In the Eurozone, we expect to continued weak growth and low inflation.

Argentina’s election over the weekend resulted in a victory for left-wing leader Alberto Fernandez over the centre-right coalition headed by Mauricio Macri. The central bank promptly imposed tighter FX controls.

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The information in this market outlook is derived from sources which we consider to be reliable. However, it may not in all cases be verified independently and we do not attest to its completeness or accuracy. No responsibility can be accepted for errors of fact or opinion. Forecasts may be the consensus of extremely divergent possibilities and the full range of potential outcomes should be appreciated. No representation or warranty is made that any value (or proximity to) any value, return or forecast will be achieved. The opinions expressed are those of employees of Schroder & Co. (Asia) Limited, and reflect their judgement at this date and are subject to change. Reliance should not be placed on the views and information in this market outlook when taking individual investment and/or strategic decisions. 

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