Market developments
Equities: China’s Shanghai Index marked its best week since 2008, climbing over 12% this week following aggressive stimulus efforts aimed at revitalizing its economy. In the U.S., some analysts believe that while current data suggests a soft landing, forward-looking indicators may signal potential risks. The S&P 500 continued to make new highs, closing around 5,750.
Fixed income: U.S. Treasuries experienced a rally to close out the week, following new economic data that bolstered expectations for further interest rate cuts by the Federal Reserve. The 10-year Treasury yield fell to approximately 3.76%. Following this data, market participants are pricing in a nearly equal chance of a quarter-point or half-point cut at the Fed’s upcoming meeting, with economists anticipating inflation will reach the central bank’s 2% target next year.
Commodities: Copper had its largest weekly increase since May, buoyed by China’s recent stimulus measures and expectations of further interest rate cuts in the U.S. The metal surged over 7% this week, following China’s announcement of various initiatives aimed at stimulating economic growth and supporting its struggling real estate sector.