Market Commentary September 2018
08 October 2018
The first week of September saw the FTSE 100 slip to a five month low of 7,383 as the pound fell amid concerns over Brexit. The index recovered from this low to close the month at 7,510.20. This recovery from the low largely driven by rising oil prices.
In economic news, GDP grew 0.6% in the second quarter following on from the hottest summer in a number of years. This stronger than expected figure keeps the UK economy on track to deliver growth of 1.3% for 2018.
Inflation hit a six year high of 2.7% as the price of clothing and package holidays increased. However, Average Earnings are still lagging behind inflation at 2.6%, meaning wages are declining in real terms.
As things continue to improve in the United States, the Federal Reserve has increased interest rate to a range of 2-2.25%. It is widely expected that this will pushed up again before the end of 2018.
Crude Oil was up 6.85% in September. The increase was driven by the expectation that US sanctions on Iran will reduce the supply of Crude oil.
| 28 September 2018 | 1 month | 6 months | 12 months | |
|---|---|---|---|---|
| FTSE 100 | 7,510.20 | 1.05% | 6.43% | 1.86% |
| GBP/USD | 1.3056 | 0.69% | -6.88% | -2.56% |
| GBP/EUR | 1.1230 | 0.47% | -1.59% | -0.99% |
| Brent Crude (US$) | 82.72 | 6.85% | 17.72% | 43.76% |
| Gold (US$ per oz) | 1,190.88 | -0.86% | -10.16% | -6.94% |
Sources:
www.xe.com
www.bloomberg.com
www.bbc.co.uk
Nothing in this communication constitutes advice to undertake a transaction and professional advice should be taken before investing. Any observations are purely commentary on markets. This material is not investment research and the content should not be treated as an offer or invitation to buy or sell securities. Past performance is not a reliable indicator of future results and is no guarantee. The value of investments may fall as well as rise. Changes in exchange rates between currencies can cause investments or income to go up or down.
