Weekly Round Up
UK markets ended the week in the green with the FTSE 100 Index gaining 0.88% to 7,176 at the time of writing. Investors digested final PMI surveys for the UK and Eurozone showing a slowdown in business activity growth during August while awaiting crucial US Jobs data released later today. UK services activity grew less than initially thought in August with the latest reading pointing to the worst month for business activity growth since the current phase of recovery began in March. New business growth lost momentum due to the end of the full stamp duty holiday and subsequent cooling in demand arising from residential property transactions.
European equity markets traded cautiously on Friday with Eurozone retail sales unexpectedly falling 2.3% from a month earlier in July 2021. Sales of non-food products slumped 3.5%, with online trade tumbling 7.3%. In addition, fuel trade dropped 1.6%, while food sales decreased for a fourth month running. Among the bloc’s largest economies, Germany reported the largest monthly decrease with sales falling 5.1%. Sales in France also declined while those in Spain were flat. On a yearly basis, trade growth slowed to 3.1%
In the US, equity futures rose modestly on Friday after Wall Street Ended higher on Thursday, with the S&P 500 and Nasdaq again hitting record highs, as investors welcomed fresh data that showed the US economic recovery continues. Traders now await the key payrolls report to confirm labour market recovery, as some confusion remains after data showed the US private sector created far fewer jobs than expected in August. The US economy likely added 750,000 jobs last month, which would cause the US unemployment rate to fall to 5.2%, a new pandemic low, as the labour market consolidates its recovery following businesses reopening. Strong jobs numbers could mean the Federal Reserve might start reducing its bond buying scheme sooner than expected, whilst a disappointing report could push back tapering expectations.
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