NBK CAPITAL MONTHLY GLOBAL MARKET REPORT

The US economy appears to show signs of continued growth, with preliminary annualized Q3GDP coming in at 3.2 percent supported by improving retail sales and a strong housing market. With the consumer price index coming in at 1.6 percent YoY, boosted by rising energy prices, and the expected increase in government spending from the Trump Administration, this could support the Fed’s case for a December rate hike.

The November US ISM manufacturing came in at 53.2, higher than October’s reading of 51.9. The November Nonfarm Payroll came in at 178,000, significantly higher than the October reading of 142,000. US unemployment improved to 4.6 percent in November versus 4.9 percent in October. Consumer confidence grew in November to 107.1 from 100.8 in October. Durable goods order came in higher than expected at 4.8 percent in October, due to a 12 percent gain in transportation orders, compared to the revised September figure 0.4 percent. Strong US housing data revealed housing starts improved 25.5 percent in October to an annualized rate of 1.323 million, marking the strongest monthly percentage gain since 1982. Existing home sales also picked up to 5.60 million while new homes sales dropped to 0.563 million in October on an annualized rate.

The UK Manufacturing Purchasing Managers Index (PMI) for November dropped slightly to 53.4 compared to 54.2 in October. UK inflation remains somewhat stable at 0.9 percent down from 1.0 percent in September. Unemployment fell to 4.8 percent, an 11-year low as the number of unemployment claims only rose 10,000 to 803,000. Consumers continue to be confident which is proving to be crucial to the UK economy; retail sales rose to 7.4 percent YoY in October, up from the revised 4.2 percent in September.

UK equities dropped 2.5%

The eurozone manufacturing sector continues to grow as evident in the preliminary manufacturing PMI of 54.1 for the month of November, up from 53.5 in October. Further supporting growth in the region, is the preliminary service PMI for November, also at 54.1 compared to 52.8 in October. Consumer confidence, although still negative, has improved from a reading of -8.0 in October to a reading of -6.1 in November. European equities in November gained 0.9 percent, as measured by the Stoxx Europe 600.

Japan posted, a trade surplus of JPY 496 billion in October, compared to JPY 498 billion in September. The surplus was driven by a continued decline in the value of