The charts that matter: a surprisingly uneventful week in markets

John Stepek looks back over the last seven days to see what effect their events have had on the charts that matter most to the global economy.

Welcome back – first things first, don’t miss this week’s podcast, in which Merryn talks to the team at Amati Global Investors about their favourite small-cap stocks, and particularly opportunities in healthcare and biotech.

Also, don’t miss this week’s issue of MoneyWeek magazine, in which we ask, are monopolies destroying capitalism, as many people on both sides of the political divide seem to believe? Or is it more complicated than that – and is probable government intervention only going to make things worse? Get your copy now - you get six weeks free plus a free report on gold investing.

And if you’ve ever struggled to understand what bonds are or how they are priced, then please watch our latest “Too Embarrassed To Ask” video for a quick beginner’s guide.

Here are the links for this week’s editions of Money Morning and other web stories you may have missed.

Now for the charts of the week.

The charts that matter

Gold clawed back some ground this week, helped partly by the market reaction to the news that Donald Trump has tested positive for Covid-19.

(Gold: three months)

Gold was also helped by the fact that the US dollar index (DXY – a measure of the strength of the dollar against a basket of the currencies of its major trading partners) gave back some of its recent gains.

(DXY: three months)

Even the Chinese yuan (or renminbi) strengthened against the dollar again this week (when the black line below rises, it means the yuan is getting weaker vs the dollar) as the US currency was generally weaker across the board.

(Chinese yuan to the US dollar: since 25 Jun 2019)

Yet again, the yield on the ten-year US government bond didn’t change much.

(Ten-year US Treasury yield: three months)

The yield on the Japanese ten-year more than doubled this week. That sounds like a huge move, but it was from 0.007% to 0.019%, so in reality it’s nothing.

(Ten-year Japanese government bond yield: three months)

The yield on the ten-year German Bund fell back a bit.

(Ten-year Bund yield: three months)

Copper fell this week as concerns grow about the impact of fresh coronavirus outbreaks on global economic activity.

(Copper: nine months)

The Aussie dollar rebounded this week as the US dollar drifted lower.

(Aussie dollar vs US dollar exchange rate: three months)

Cryptocurrency bitcoin fell somewhat towards the end of the week, but well within the sort of range you’d expect from the cryptocurrency.

(Bitcoin: three months)

US weekly jobless claims were lower than analysts expected. There were 837,000 new claims, down from 873,000 last week (that was revised a little higher from 870,000). The four-week moving average fell to 867,250 from 878,250 previously.

More importantly, the US non-farm payrolls data for September came out on Friday. US workplaces only added 661,000 jobs, compared to expectations for 850,000. That said, the August gain was revised up to 1.49 million jobs from 1.32 million, so that was quite an improvement. Also the unemployment rate fell to 7.9% from 8.4%, which beat analysts’ expectations.

It’s going to be difficult to get a reliable picture of what’s going on for quite some time, so the relatively muted market reaction wasn’t surprising.

(US jobless claims, four-week moving average: since Jan 2020)

The oil price (as measured by Brent crude) continued to drop this week as the threat of more lockdowns hangs on demand.

(Brent crude oil: three months)

Amazon gained this week as the Nasdaq index recovered some ground from its recent falls.

(Amazon: three months)

Tesla also ended the week higher.

(Tesla: three months)

Recommended

Why we should scrap the Budget
Budget

Why we should scrap the Budget

The yearly Budget, big set-piece of British politics, encourages the very worst from the government, says Matthew Lynn.
24 Oct 2021
The charts that matter: bond yields turn back up and a new bitcoin record
Global Economy

The charts that matter: bond yields turn back up and a new bitcoin record

Bitcoin hit a new all-time high, while government bond yields turned back up. Here’s how that has affected the charts that matter most to the global e…
23 Oct 2021
Larry Fink: the undisputed king of Wall Street
People

Larry Fink: the undisputed king of Wall Street

Larry Fink survived two big financial crises and went on to build a massive asset manager, doing for investing what Henry Ford did for cars. He has hi…
23 Oct 2021
Cryptocurrency roundup: bitcoin hits a new record high
Bitcoin & crypto

Cryptocurrency roundup: bitcoin hits a new record high

In the week when bitcoin hit a new high, we look at what’s been going on in the world of cryptocurrencies this week.
22 Oct 2021

Most Popular

Properties for sale for around £1m
Houses for sale

Properties for sale for around £1m

From a stone-built farmhouse in the Snowdonia National Park, to a Victorian terraced house close to London’s Regent’s Canal, eight of the best propert…
15 Oct 2021
How to invest as we move to a hydrogen economy
Energy

How to invest as we move to a hydrogen economy

The government has started to roll out its plans for switching us over from fossil fuels to hydrogen and renewable energy. Should investors buy in? St…
8 Oct 2021
How to invest in SMRs – the future of green energy
Energy

How to invest in SMRs – the future of green energy

The UK’s electricity supply needs to be more robust for days when the wind doesn’t blow. We need nuclear power, says Dominic Frisby. And the future of…
6 Oct 2021