Top Three Market Headlines
U.S. Economic Activity Softens in September: Economic conditions in the U.S. softened in September, according to a pair of closely-watched monthly surveys of business executives conducted by The Institute for Supply Management (ISM). Business activity in the manufacturing sector continued to fade, as the ISM Manufacturing index registered 47.8, its lowest level since June 2009 and its second straight sub-50 reading (greater than 50 indicates expansion, while less than 50 reflects contraction). Meanwhile, the services sector continued to expand, but at a weaker pace: the ISM Non-Manufacturing index came in at 52.6, its lowest reading in three years and down from 55.3 in August.
WTO Expects Global Trade to Slow in 2019: The World Trade Organization (WTO) said last week it expects the flow of goods across borders to increase by only 1.2% this year, a deceleration from the 3.0% increase observed in 2018. If this forecast proves accurate, it would be the lowest annual increase since 2009. The WTO noted that slowing trade could negatively impact investment and jobs as firms employ fewer workers to produce goods and services to export. Since early 2018, global trade has been disrupted by the ongoing trade dispute between the U.S. and China. The U.S. has raised tariffs on imports from other countries as well, most recently instituting tariffs on $7.5 billion of European goods, including commercial jetliners, Irish and Scotch whiskies, and cheeses, following a WTO ruling that the European Union provided illegal subsidies to Airbus.
September Jobs Report: The U.S. Department of Labor reported on Friday that the U.S. economy added 136,000 jobs in September. While this was short of analysts’ expectations, previously-reported totals for August and July were revised upward by a total of 45,000, putting the trailing three-month average at 157,000. Meanwhile, the unemployment rate dipped to 3.5% in September, its lowest level since December 1969. Despite the declining unemployment rate, wage growth decelerated in September, as average hourly earnings rose 2.9% from a year earlier, a decrease from the 3.2% pace in the prior month.
Data Points
- The ISM Manufacturing index fell to 47.8 in September, its lowest reading since June 2009
- World Trade Organization forecasts that trade flows will increase 1.2% in 2019, down from 3% in 2018
- The unemployment rate fell to 3.5% in September, the lowest level since 1969
|
As of October 4, 2019 |
Week |
Quarter-To-Date |
Year-To-Date |
One-Year |
|
MSCI All Country World |
-0.92% |
-1.09% |
14.93% |
1.42% |
|
S&P 500 |
-0.30% |
-0.80% |
19.59% |
3.83% |
|
Russell 2000 |
-1.28% |
-1.47% |
12.49% |
-7.54% |
|
MSCI EAFE |
-2.16% |
-1.83% |
10.74% |
-1.57% |
|
MSCI Emerging Markets |
-0.46% |
-0.41% |
5.45% |
1.19% |
|
FTSE NAREIT |
0.40% |
0.33% |
27.39% |
22.55% |
|
Bloomberg Commodity |
-0.48% |
0.22% |
3.36% |
-8.12% |
|
Barclays Aggregate |
0.81% |
0.77% |
9.35% |
12.00% |
Bureau of Labor Statistics 10/4/19, Marketwatch 10/1/19, 10/3/19, WSJ 10/1/19, 10/3/2019; Data from Morningstar Direct. Returns for periods greater than one year are annualized. Investment advisory, named and independent fiduciary services are offered through Gallagher Fiduciary Advisors, LLC, an SEC Registered Investment Adviser. Gallagher Fiduciary Advisors, LLC does not express an investment opinion regarding any specific commodity, sector or individual security. Unless otherwise expressly noted, the contents of this communication do not constitute securities or investment advice, nor should this communication be construed as an opinion regarding the appropriateness of any investment. Gallagher Fiduciary Advisors, LLC is a single-member, limited-liability company, with Gallagher Benefit Services, Inc. as its single member. Neither Arthur J. Gallagher & Co., Gallagher Fiduciary Advisors, LLC nor their affiliates provide accounting, legal or tax advice. The information provided cannot take into account all the various factors that may affect your particular situation, therefore you should consult your Gallagher Fiduciary Advisors consultant before acting upon any information or recommendation contained herein to discuss the suitability of the information/recommendation for your specific situation.