Weekly Market Update - 23 October 2023
US Retail Sales Increased
US retail sales increased more than forecast in September, in a broad advance that suggests durable household demand. The data showcases a consumer that’s still powering ahead despite a recent energy-driven pickup in inflation. While wage growth is starting to lose steam, the labor market remains generally strong, offering Americans the leeway to keep spending. “The death of the US consumer has been greatly exaggerated,” Omair Sharif, president of Inflation Insights, says. The breadth of retail sales gains across categories showcased a US consumer who’s willing and able to spend. That adds to the case for higher-for-longer interest rates, pressuring equities and other risk assets.
Source: Bloomberg
Biden In Israel
US President Joe Biden’s 7.5-hour trip to Tel Aviv signaled his full backing for Israel but fell short of another key goal: winning over Arab leaders. The president made plain that the US will protect its ally, sending a clear message to rivals in the region like Iran to stay out of the fight. With one US aircraft carrier in the area and another on the way, Biden promised a new package of “unprecedented support.” He also said Israel agreed to allow a flow of humanitarian aid to Gaza, and cited US intelligence to support claims that Palestinian militants were to blame for a deadly hospital blast. “We believe in the fundamental dignity of every human life,” Biden stated, which he said “sets us apart from the terrorists.”
Source: Bloomberg
Morgan Stanley Miss
Morgan Stanley shares plunged the most since June 2020 after the bank’s dealmakers posted the biggest drop in fees on Wall Street and its wealth management unit posted the lowest inflows in more than three years. Even so, trading beat expectations. “This is solid performance in a mixed environment,” CFO Sharon Yeshaya said, adding that M&A announcements in the quarter were up 50% on a year-over-year basis and the bank sees the backlog continuing to grow.
Source: Bloomberg