Fisher Investments Reviews: Last Week in Markets—July 1 - July 5

In the US, the final June S&P Global Manufacturing Purchasing Managers’ Index (PMI) was revised slightly lower from flash estimates to 51.6, while the final Services PMI was revised up to 55.3 (readings over 50 indicate expansion). Nonfarm payrolls increased by 206,000 in June, above expectations. The June unemployment rate ticked up to 4.1%, above forecasts.

In the UK, the final June S&P Global/CIPS Manufacturing and Services PMIs were 50.9 and 52.1, respectively. May money supply (M4) fell 0.1% m/m. On July 4, the UK held its 2024 general election. As expected, The Labour Party won a majority of seats in the House of Commons and Labour leader Keir Starmer was named the next prime minister, unseating the incumbent Conservative party after 14 years. While Labour’s victory likely fuels fears of a leftward economic policy shift, the party’s platform and Keir Starmer are known quantities. In our opinion, the fear is almost surely priced, creating big positive surprise power as investors realize Starmer’s policies largely extend the outgoing Conservatives’. For more, please see our 7/5/2024 commentary, "Britain's Labour Landslide Changes Little for Stocks."

In the eurozone, the final June HCOB Manufacturing PMI was 45.8 and the final Services PMI was 52.8—both higher than flash estimates. May retail sales rose 0.1% m/m and 0.3% y/y. May unemployment remained unchanged at 6.4%.

In Japan, the final June Jibun Bank Manufacturing PMI was 50.1, slightly down from the flash reading, while the final Services PMI was revised down to 49.4. In China, the final June Markit/Caixin Manufacturing and Services PMIs were 51.8 and 51.2, respectively.

The Week Ahead

The US and China release June consumer prices. The UK, eurozone and Japan report May industrial production. China releases May money supply, retail sales and unemployment data.

Source for all data cited is FactSet. This update constitutes the general views of Fisher Investments and should not be regarded as personalized investment advice. No assurances are made we will continue to hold these views, which may change at any time based on new information, analysis or reconsideration. In addition, no assurances are made regarding the accuracy of any forecast made herein. Global equities are represented by the MSCI World Index. The MSCI World Index measures the performance of selected stocks in 23 developed countries and is presented net of dividend withholding taxes and uses the maximum rate applicable to non-resident institutional investors who do not benefit from double taxation treaties. Past performance is no guarantee of future results. A risk of loss is involved with investments in stock markets.