FYI: .Toward the end of October, outflows from mutual funds intensified, with $28.7 billion withdrawn during the week ended October 31 and $12.7 billion pulled out in the week prior.
.The lion’s share of outflows occurred in the realm of bond funds, with nearly $25 billion withdrawn over the two weeks. Equity mutual funds suffered less of a severe blow, as roughly $11 billion were pulled out. Large-cap equities was the only category that experienced inflows during the period, less than $300 million.
.The U.S. Democrats gained control of the House of Representatives for the first time in eight years, in a blow to President Donald Trump’s agenda of cost cuts and repealing the Affordable Care Act. Republicans won the Senate.
.The U.S. Federal Reserve maintained interest rates at 2.25%, but strongly signaled a rate hike will come in December, with a few more to follow next year. A recent market rout and an abrupt uptick in inflation have not convinced policymakers to withhold their fire, indicating they are pleased with the current environment.
.The U.S. jobs market is strong and improving. In October, the economy added 250,000 jobs versus the 194,000 expected by analysts. The unemployment rate stood flat at 3.7%, while average hourly earnings increased by 0.2%.
.Rising energy prices have taken inflation in the Eurozone above the European Central Bank’s target. Consumer prices in Europe were up 2.2% in October, largely due to rising prices for energy, food and alcohol. Stripping the volatile items, including energy, inflation was up just 1.1%.
Regards,
Ted
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