Welcome back to InvestEngine’s weekly market roundup, your quick look at what’s been moving the markets and what it means for investors.
Here’s Andrew Prosser, Head of Investments at InvestEngine, with all the big news from the week.
It’s been an eventful week, with pockets of volatility across different areas. The standout story? Gold.
A sharp dip for gold in a solid year
Gold made headlines on Tuesday when it fell around 6% in a single day. Despite the dramatic move, it only slipped back to where it was the week before — more of a blip than a crash.
Even after that dip, gold remains up nearly 50% so far this year in sterling terms. That rise has been driven by a combination of a weaker US dollar, continued central bank buying, and falling bond yields — all factors that tend to support gold prices.
Tech earnings and a strong US market
In the US, two big names – Netflix and Tesla – released their quarterly earnings. Both stocks fell initially after their reports, but Tesla later recovered its losses. Neither update had much effect on the wider market, which actually saw strong gains for the week.
Big tech led the rally, helped by easing trade tensions between the US and China. The White House confirmed that talks remain on track and that both nations’ leaders are still expected to meet next Thursday. That helped boost investor confidence and lift share prices.
Oil prices surge on new sanctions
Oil prices rose sharply this week, gaining just over 7% after the US announced new sanctions on two of Russia’s largest oil companies. The move is part of efforts to pressure Moscow over the ongoing war in Ukraine.
Higher oil prices have been good news for the FTSE 100, which includes major energy companies like BP and Shell. The index hit a new all-time high on Thursday as those stocks climbed.
Reduced inflation supports rate cut hopes
Friday brought more positive news from the US. Inflation data, delayed slightly by the recent government shutdown, came in lower than expected.
The figures strengthened market expectations that the Federal Reserve could cut interest rates at its meeting next week. That helped push global stocks even higher heading into the weekend.
A strong finish to the week
All in all, it’s been a good week for investors. By Friday afternoon, all major equity markets were set to finish the week in the green.
While short-term volatility is inevitable, as gold’s swings showed, this week’s moves underline how quickly market sentiment can turn. Staying invested and diversified can help smooth out those bumps along the way.
Important information
Capital at risk. The value of your investments may go down as well as up, and you may get back less than you invest.
ETF costs apply. If in doubt, you may wish to consult a professional adviser for guidance.
Tax treatment depends on your personal circumstances and may change in future. This article is for general information only and does not constitute financial advice.