Market Quote: S&P 500 Technicals, Government Bond Yields, Emerging Market Expectations
Author: The editor's desk
October 6, 2023
Members of AGF’s Investment Management Team weigh in on the week that was in global financial markets.
Hold the Line
“The S&P 500 index continues its battle to hold the critical 4,200 mark, which was the breakout level for the index to rally higher in June as well as the 200-day moving average. The start of October has continued to show a high level of volatility, with trading days so far exhibiting nearly a 1% daily trading range. Investors should continue to assess the macro backdrop, upcoming earnings releases and the possibility for more U.S. government drama to unfold as we head into year end.”
Put to the Test
“Emerging Market equities are being tested by the move higher in U.S. rates and higher oil prices. Investors may need to temper expectations of rate cuts in developing countries this year and be more selective on country and stock selection. India is relatively more insulated from higher rates, for instance, and could benefit from the combination of its Make in India initiative and being a destination of choice for manufacturing offshoring.”
Putting Up a Fight
“After a substantial 0.5% rise in bond yields in September, the fixed income market attempted to stabilize this week from an oversold position, aided by declining oil prices. However, solid manufacturing and employment data sparked yet another rise in yields to fresh new 16-year highs in both the U.S. and Canada. From here, the market will continue to focus on inflation and employment reports and seek evidence of strains from higher rates in the economy to determine direction from these levels.”
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The views expressed in this blog are those of the author and do not necessarily represent the opinions of AGF, its subsidiaries or any of its affiliated companies, funds, or investment strategies.
Commentary and data sourced from Bloomberg, Reuters and company reports unless otherwise noted. The commentaries contained herein are provided as a general source of information based on information available as of October 5, 2023 and are not intended to be comprehensive investment advice applicable to the circumstances of the individual. Every effort has been made to ensure accuracy in these commentaries at the time of publication, however, accuracy cannot be guaranteed. Market conditions may change and AGF Investments accepts no responsibility for individual investment decisions arising from the use or reliance on the information contained here.
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