Week in Markets (Week Ending November 17, 2019)

November 18, 2019

Key News and Events

  • Reports suggest that the “phase one” U.S.-China trade deal has run into difficulties as both countries continue to differ over issues such as intellectual property protections, agricultural purchases and tariff rollbacks. Meanwhile, President Trump threatened to raise U.S. tariffs on Chinese goods "substantially" if no agreement can be reached.
  • UK and Germany avoided a technical recession in Q3, growing by 0.3% and 0.1% respectively to avoid recording two consecutive quarters of negative growth. However, the UK economy grew at the slowest annual rate in nine years, whilst Germany's surprise return to growth in Q3 was dampened by a downward revision to its Q2 growth reading.
  • Protests in Hong Kong escalated further amidst clashes between police and protestors at the city's universities. Meanwhile, Hong Kong became the only developed market to fall into recession after recording a 3.2% contraction in the third quarter.  

Week in Markets


  • Global equity markets rose over the week.
  • The S&P 500 index rose by 0.9% over the week, outperforming the MSCI World index, which rose by 0.7%. On a year-to-date basis, S&P 500 index outperformed the MSCI World index (26.7% vs 24.0%).
  • U.S. Large Cap stocks outperformed Small Cap stocks over the week, as the S&P 500 index rose by 0.9% while the Russell 2000 index fell by 0.1%. On a year-to-date basis, the S&P 500 index outperformed the Russell 2000 index (26.7% vs 19.8%).
  • Growth stocks outperformed Value stocks over the week as measured by the MSCI USA Growth and Value index. Growth Stocks rose by 1.6% while Value Stocks rose by 0.3% over the week. On a year-to-date basis, Growth Stocks outperformed Value Stocks (32.0% vs 21.8%).


  • The 10-year U.S. treasury yield fell by 9bps to 1.84% and 30-year U.S. treasury yield fell by 10bps to 2.31% over the week.
  • The 20-year TIPS yield fell by 3bps to 0.41% and 20-year breakeven inflation fell by 8bps to 1.75% over the week.
  • The spreads on the Bank of America Merrill Lynch U.S. Corporate Index rose by 1bps to 112bps and the spreads on the Bloomberg Barclays Long Credit Index rose by 1bps to 155bps over the week.
  • The U.S. High Yield bond spread over U.S. treasury yields rose by 6bps to 406bps and the spread of USD denominated EM debt over U.S. treasury yields rose by 10bps to 331bps over the week.


  • The S&P GSCI index was unchanged in USD terms over the week.
  • The S&P GSCI Energy index rose by 0.9% as the price of WTI crude oil rose by 0.8% to US$58/BBL.
  • Industrial Metal prices fell by 3.1% as copper prices fell by 2.3% to US$5,812/MT.
  • Agricultural prices fell by 0.9% and gold prices rose by 0.2% to US$1,467/Oz.


  • The U.S. dollar depreciated against most major currencies (except the Canadian dollar) over the week.
  • Sterling appreciated by 0.9% against the U.S. dollar over the week, ending the week at $1.29/£.
  • The euro appreciated by 0.3% against the U.S. dollar over the week, ending the week at $1.11/€.
  • The Japanese yen appreciated by 0.4% against the U.S. dollar over the week, ending the week at ¥108.74/$.
  • The Canadian dollar remained unchanged against the U.S. dollar over the week, ending the week at C$1.32/$.

Highlighted Last Week Releases





Industrial Production MoM

Industrial production in the U.S. declined by 0.8% in the month of October, the steepest contraction since May 2018, as sales of motor vehicles and parts slumped by 7.1% amidst a strike by auto workers. Analysts have been expecting a smaller contraction of 0.4%.




The UK economy grew by 0.3% in Q3, avoiding a recession and recovering from the 0.2% contraction recorded in the previous quarter. The services sector grew by 0.4% over the quarter, benefiting from strong performances of the healthcare and finance sectors, whilst the manufacturing sector remained flat. Year-on-year, the economy grew by 1.0%, the lowest annual growth in nine years.




The German economy unexpectedly avoided a recession after growing by 0.1% in the third quarter. Analysts have been expecting a second consecutive quarter of contraction to follow up the -0.2% growth recorded in Q2. Increased spending by consumers and the public sector benefited the economy, offsetting the impact of a weakening manufacturing sector.

Sources: Global Asset Allocation, Bank of America Merrill Lynch, Barclays Capital, Factset. Click here for index descriptions.

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