Fisher Investments Reviews: Last Week in Markets—December 18 - December 22

Global equities rose. 

Last Week’s Returnsⁱ

In the US, the third estimate of Q3 2023 GDP was 4.9% annualized—revised down from the second estimate of 5.2% but matching the first estimate. Preliminary November durable goods orders rose 5.4% m/m, more than expected. November new home sales declined 12.2% m/m. The Conference Board’s Leading Economic Index (LEI) declined 0.5% m/m in November. The headline Personal Consumption Expenditures (PCE) price index—the Fed’s preferred inflation gauge—fell 0.1% m/m in November and rose 2.6% y/y. Notably, over the last six months, the headline PCE price index rose an annualized 2.0%—right around the Fed’s target. For more, please see our 12/22/2023 commentary, “Quick Hit: The Fed’s Target Draws Near.”

In the eurozone, consumer prices fell 0.6% m/m but rose 2.4% y/y. November core consumer prices rose 3.6% y/y. In the UK, the second estimate of Q3 2023 GDP was -0.1% q/q and 0.3% y/y—both figures lower than the first estimate. Q3 2023 imports and exports fell 1.0% q/q and 0.6% q/q, respectively. November retail sales rose 1.3% m/m and 0.1% y/y. November consumer prices fell 0.2% m/m but rose 3.9% y/y. November core consumer prices rose 5.1% y/y. The UK’s household energy price cap is one of the main factors slowing inflation progress—and points to further significant improvement next year. For more, please see our 12/20/2023 commentary, “The Recent Past and Likely Future on UK Inflation.”

In Japan, November consumer prices fell 0.1% m/m and increased 2.8% y/y. November core-core consumer prices (excluding food and energy) rose 3.8% y/y. The Bank of Japan maintained its key short-term interest rate at -0.1% and its 10-year bond yield target around 0%. Preliminary November imports and exports fell 11.9% y/y and 0.2% y/y, respectively.

The Week Ahead

Japan reports November industrial production, retail sales and unemployment figures. China releases December manufacturing and services purchasing managers’ indexes (PMIs).

Tip of the Week

US financial markets and Fisher Investments’ offices will be closed Monday, January 1. The next Prior Week­­­–At a Glance will be sent on Tuesday, January 2. We wish you and your families a safe and enjoyable holiday season.

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. Any commentary regarding strategy or performance reflects our Global Total Return strategy benchmarked to the MSCI World Index. Some clients may have different benchmarks reflecting different objectives and circumstances, including permanent allocations to cash or fixed income. Please note that accounts may not contain all elements of the strategy discussed here. Additionally, individual client customizations and start dates may preclude certain elements of this strategy from being implemented. 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. The S&P 500 Composite Index is a capitalization-weighted, unmanaged index that measures 500 widely held US common stocks of leading companies in leading industries, representative of the broad US equity market. The MSCI Europe, Australasia and Far East (EAFE) Index is an unmanaged, capitalization-weighted stock index measuring the performance of selected stocks in 21 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. The MSCI World Small Cap Index is an unmanaged, capitalization-weighted stock index measuring the performance of investable securities with a market capitalization below that of the companies in the MSCI Standard Indexes, targeting approximately 14% of free-float adjusted market capitalization in 23 developed countries. It is presented here net of dividend withholding taxes and uses the maximum rate applicable to non-resident institutional investors who do not benefit from double taxation treaties.

ⁱSources: Eagle PACE, FactSet, Bloomberg. The Fisher Global Total Return performance results are based on a representative portfolio (rather than a composite or an average group of portfolios). This representative portfolio information is derived from an actual client portfolio and is selected based on a number of criteria including, but not limited to, tax status, size of cash flows, and presence of client-mandated restrictions to identify a portfolio that is managed with minimal deviations from the intended strategy. Returns are calculated net of management fees by applying a 1.25% annual fee rate weekly. Other clients' portfolio characteristics may differ given the various investment restrictions, cash requirements and other circumstances that can apply to particular clients. You can request returns for your specific account from your Investment Counselor.