The End of the Second Quarter is Moving into Surprisingly Positive Territory

UK & Europe: Data Galore

Multiple batches of data were released across the European region last week, showing the health of various economies. 

The UK economy grew by 0.1% in the first quarter of 2023, which officially confirms that they dodged recession once again. 

Please note: With any major data release, there are often forecasts released prior to the official number. We examined the pre-release last month of the UK growth data for example. 

Eurozone inflation hit 5.5%, down from the previous month and moving ever closer to where the central bank wishes.

Internally, however, there are now some gaps forming between European countries in the race to get inflation back down. 

Italy saw inflation fall from 8% to 6.7%, whilst Germany saw a slight raise from 5.4% to 5.8%. 
Spain really pipped the others to the post, being the first country in the region to have their inflation hit the desired 2% mark. 

The Euro Stoxx 50 is up 14.4% for the year, with the French CAC 40 up 12.2% and the German DAX 40 also up by just over 14%. 

Despite the positive inflation news, the ongoing internal issues in the UK has left the FTSE 100 as an outlier, being in negative territory for the year at a tiny -0.16%. 

Americas: Positive Tones

US markets also followed the cheery European news, ending the week and the second quarter of the year in positive territory. 

Stronger economic signals helped boost this growth, including an alternative measure of inflation that was released last week called the Personal Consumption Expenditure (PCE) index. 

To round off the positive news, Apple hit the coveted $3 trillion market cap mark last week, which is the first time that mark has ever been hit as the market bell has closed. 

Asia & Australasia: Chip Restrictions

Over in China, however, data showed that manufacturing fell again in June, suggesting that economic output is struggling to get off the ground. 

The US and the Netherlands announced further plans to restrict trade on chips and semiconductors. This will undoubtedly impact trade in both China and with global chip companies closely tied with the Chinese markets. 

Pakistan meanwhile, announced a ‘staff pact’ level agreement with the IMF to receive a $3 billion bail out loan. This seemed to boost markets and investors in their ability to turn things around. 

Stock World: IPO Traction

IPOs have mostly slowed down during the tough economic period of the last year. But with signs of a brighter second half to the year, this seems to be changing.  

Swiss chemicals giant Sygenta is set to IPO in mainland China in the coming weeks. 

So far, it seems that the IPO will target mostly domestic investors, as international banks have yet to be included in the planning of the IPO. It would also be the fourth largest IPO in mainland China’s history. 

Sources have suggested that Chinese retail giant Shein has expressed interest in listing on the New York Stock Exchange, which would be the largest Chinese company to list since 2021. 

Allbirds, one 2021’s IPO failures, launched the world's first carbon neutral shoe in Copenhagen last week. 

With the share price of the shoe company down by 91% since first listing, there’s a long way to go to convince investors that it’s got the strength to turn things around.