This is our weekly market update, where we start in the US, cross to Europe and Asia, and end in Australia, while covering the main points in commodities and crypto along the way.
This past week has been a doozy, with US markets still clawing higher on increased rate cut expectations, as the latest employment data and adjustments posed some important questions alongside a weakening the dollar, while in the UK the incoming Labour Government won with a whopping seat majority despite voters really voting against the Tories rather than for Starmer.
In France, horse trading ahead of Sundays second pole could mean the Right do not get the prize they were expecting, while Oil was firmer across the week on fears of middle east conflicts and in Crypto, Bitcoin has dropped more than 20% from recent highs.
Wall Street stock indexes closed firmer on Friday, with the tech-heavy Nasdaq and benchmark S&P 500 hitting record highs.
All up, the Dow Jones Industrial Average rose 0.17%, to close at 39,375.87. The S&P 500 gained 0.54%, at 5,567.19 and the Nasdaq Composite advanced 0.90%, to 18,352.76. For the week, the S&P 500 gained 1.95%, the Nasdaq rose 3.5% pct, and the Dow climbed 0.66%. The Russell 2000 Small Cap index is down 0.95% for the week and the S&P500 equal weight was parallel to its 2022 high, showing the narrowness of the support for the all time highs on the S&P500.
French financial markets have come under selling pressure since President Emmanuel Macron called for a snap election last month, with concerns that a far-right win could add to worries over fiscal sustainability. But there is also nervousness about what will happen if there is no clear winner in Sunday’s second round of voting. Fresh polls showed the far-right National Rally (RN) party and its allies were still in the lead but looked to fall short of getting an outright majority.
The UK national election on Thursday propelled the Labour Party to a sweeping victory, and Labour leader Keir Starmer became the next Prime Minister. In the six-week election campaign,
The latest update indicates that Labour has won 411 seats, and the Conservatives have secured 121 seats. This gives Labour a massive majority in the House of Commons. One seat has not yet declared a winner.
Actually, though this was a vote against the Tories, while the share of the vote Labour got hardly moved, and was in fact lower than in recent elections, votes went to the right in the form of Reform, or to the Liberal Democrats, Greens and other parties – and Labour was unseated in a couple of spots as a result of this, and in the light of their stance on Gaza.
As Sky put it, A thumping majority without a thumping share of the vote’. Chief Pole analyst John Curtice said “Actually, but for the rise of the Labour Party in Scotland… we would be reporting that basically Labours vote has not changed from what it was in 2019”. Roughly one third of the votes and two thirds of seats shows the problem with the first past the post system, with turnout (which is not compulsory) below 60%. Labour is pretty centralist and conservative.
Starmer did not win because Britain was hankering for a social-democratic government. He did not win because his Albanese-style small-target strategy appealed to voters. He won merely because he wasn’t the government. Starmer won because Labour was not the Tories. Prime Minister Rishi Sunak’s government was stale, tired, divided, regicidal and largely directionless, sapped by eight years of post-Brexit chaos.
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