The Weekly View, 9th September 2024

Hello and welcome to the Unio Weekly View for the week beginning 9th September, our summary of markets and macro news.

In Summary

• The market’s focus this week will be on Europe, as the ECB will make an interest rate call on the 12th. Earlier this summer President Lagarde indicated that rate cuts were on the table for the September meeting and with August’s headline inflation rate (2.2%) hitting its lowest level since July 2021, the market is pricing in a 25bps cut from the current rate of 4.25% and there looks to be further flexibility for the ECB to continue cutting.
• In the US, headline and core inflation data will be published on the 11th. The current rate stands at 2.9% and 3.2% respectively. A weaker print could increase the likelihood of a larger rate cut at the end of the month. Its also worth noting Chinese inflation data was issued today, with the headline rate coming in at 0.6% up from 0.5% in July.
• There are still some large software companies left to publish their earnings this week. Two of the big beneficiaries of AI demand, Oracle (1Q25) and Adobe (3Q24) will report today and on the 12th respectively.

Chart of the Week

Normally once the Fed begins a rate cutting cycle, the 10-year yield falls quickly in response. As the September Fed meeting approaches, the question arises ‘will the 10 year yield behave in the same way as it has historically when rates are cut?’.

Unio Equities Chart

Unio Bonds Charts

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