Fisher Investments Reviews: Last Week in Markets—August 28 – September 1

In the US, the second estimate of Q2 2023 GDP growth was revised down to 2.1% annualized from the initial 2.4% estimate. The final August S&P Global Manufacturing Purchasing Managers’ Index (PMI) was 47.9, higher than expected. PMI readings below 50 indicate contraction. August nonfarm payrolls increased by 187,000 while the August unemployment rate ticked up to 3.8%. In our view, recent jobs growth looks pretty similar to prepandemic rates. This is more evidence of the return to normal—not a bad thing for markets. For more, please see our 9/1/2023 commentary, “August’s Jobs Report Is a Throwback.”

In the eurozone, the final August HCOB Global Manufacturing PMI was 43.5, lower than expected. August flash headline and core (excluding food and energy) consumer prices both rose 5.3% y/y. The July unemployment rate remained at 6.4%, in line with forecasts. July money supply (M3) decreased 0.4% y/y. In the UK, the final August S&P Global/CIPS Manufacturing PMI was revised slightly higher to 43.0. July money supply (M4) contracted 0.9% y/y and 0.5% m/m.

In Japan, the final August Jibun Bank Manufacturing PMI was revised slightly down to 49.6. Preliminary July industrial production fell 2.0% m/m and 2.5% y/y. Preliminary July retail sales rose 2.1% m/m and 6.8% y/y, both better than expected. The July unemployment rate increased to 2.7%, slightly above consensus estimates. July exports fell 0.3% y/y while imports fell 13.6% y/y. In China, the August Markit/Caixin Manufacturing PMI was 51.0, beating expectations. The official NBS Manufacturing and Non-Manufacturing PMIs—focused on large, state-owned firms—were 49.7 and 51 in August, respectively.

The Week Ahead:

The US, UK, eurozone, Japan and China report final August Services PMIs. The eurozone reports its third Q2 2023 GDP estimate while Japan reports its second. The eurozone also releases July retail sales. China and Japan report August loan growth. China also reports August consumer prices, trade data and money supply (M2).

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.