Market developments
Equities: Despite this positive trend, the overall stock market is beginning to show signs of fatigue as the S&P 500 faced its first weekly loss in four weeks. In addition to US market movements, there was notable investment activity in Chinese stocks, with approximately $5.6 billion flowing into equity funds as China’s leaders pledged further stimulus measures to boost economic growth.
Fixed income: Inflation data released earlier this week, along with an uptick in unemployment insurance claims, did not significantly impact expectations for a rate cut at the upcoming Fed meeting. Analysts maintain strong confidence in a 25 basis point. The Bank of Canada cut its key interest rate by 50bps in December, marking a total of 175 basis points in reductions this cycle. Overall, yields closed higher this week, driving North American bond prices lower.
Commodities: Oil prices increased as geopolitical tensions, particularly involving Russia and Iran, countered forecasts of a supply surplus for the coming year. Additionally, the United Arab Emirates has reduced oil shipment allocations to some Asian customers, suggesting stronger compliance with OPEC+ quotas.