Market Monitor - 17 September 2021
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Market Monitor – 17 September 2021

Stock markets around the world have had another volatile week, with concerns about the difficult post-Covid recovery to the fore once again. Most major indices have, however, managed to avoid serious losses – with the notable exception of bourses in China, where a slew of negative economic and political news has spooked investors.

Asia

Reports on Monday indicated that Chinese authorities were planning to break up Ant Group’s online payments service Alipay while also bringing some of Ant’s operations under state control. This move is the latest in a string of recent direct market interventions by the Beijing government.
Meanwhile, the crisis at property giant Evergrande continues: the company is currently struggling to service its $300 billion debt pile and on Thursday it applied to halt trading in its corporate bonds after yet another ratings downgrade.
With Chinese economic data also coming in short of expectations later in the week, the Hang Seng index in Hong Kong closed Thursday’s session almost 6% lower for the week, dropping back to its weakest level in nearly a year. In Europe and North America, meanwhile, markets showed little sign of being affected by the turmoil in the Far East.

The US

Data continues to highlight the problems facing many businesses as they try to cope with rising demand in the face of serious stock and materials shortages and supply chain disruption. However, a surprise fall in inflation in the United States last month provided more support for the Federal Reserve’s contention that higher prices are likely to be a short-lived phenomenon – and that an imminent tightening of monetary policy will therefore be unnecessary.
On Wall Street, the Dow Jones Industrial Average ended trading on Thursday 0.4% up for the week so far, while the S&P 500 closed 0.3% higher. US retail sales for August also came in better than expected, while it was reported that import prices fell last month for the first time this year.

The UK & Europe

In the UK, the FTSE 100 closed on Thursday level for the week. Official figures published on Tuesday highlighted the struggles many businesses are facing in recruiting staff, with vacancies across every sector of the economy higher this quarter than in the previous three-month period.
Indications from ministers that they are planning to relax Britain’s strict rules on international travel helped send airline shares higher, while a rise in the oil price later in the week provided a boost for the likes of Shell and BP.
In Frankfurt, the DAX index ended Thursday’s session up 0.3% for the week, while France’s CAC 40 lost 0.6%. A recent spike in the price of natural gas across Europe is causing significant concern in both the UK and across the eurozone. Rising costs have prompted a number of energy-intensive manufacturing businesses, such as fertiliser producers, to suspend operations: a continent-wide lack of fertiliser is likely only to add to the supply-chain problems facing the European food industry at present.
September 10
September 16
Change (%)
FTSE 100
7029.2
7027.5
0.0
FTSE All-share
4056.2
4051.4
-0.1
S&P 500
4458.6
4473.8
0.3
Dow Jones
34607.7
34751.3
0.4
DAX
15609.8
15651.8
0.3
CAC 40
6663.8
6622.6
-0.6
ACWI
737.3
735.2
-0.3
Hong Kong Hang Seng
26205.9
24667.9
-5.9
Nikkei 225
30381.8
30323.3
-0.2
Note: all market data contained within the article is sourced from Bloomberg unless stated otherwise, data as at 16/9/2021.
17 September 2021
Mark King
Mark King
Head of Investment Content
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Market Monitor – 17 September 2021

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