Metro Bank's Troubles and the Viral Impact on Small Businesses

Market Commentary

Based on our latest observations, last week in the market we saw Silver, NDX, and HSI as the top outperformers with returns of 1.52%, 0.91%, and 0.89% respectively. These assets showed significant positive returns compared to others in the dataset. On the other hand, Brent and WTI underperformed with returns of -6.76% and -6.79% respectively, indicating a significant decline in returns.

The treasury yields are currently trading higher compared to last week. The current yields on Treasury securities have increased, suggesting that interest rates have risen in the short term. This indicates a potential shift in market expectations and possible changes in economic conditions.

In terms of risk/reward ratio, DAX, NDX, and CAC have the highest ratios among the listed securities, indicating higher risk but also potential for higher rewards. On the other hand, HSI, Brent, and WTI have the lowest risk/reward ratios, suggesting lower risk but also lower potential for rewards.

Securities with the lowest average correlation with all other assets include Brent, WTI, Gold, Silver, ASX200, HSI, and NK225, with Security 2846.HK showing the lowest correlation of 0.27. These assets have the potential to provide diversification benefits to a portfolio.

In global markets, there were several noteworthy events last week. Apple released an iOS update fixing overheating issues with the iPhone, Xbox Game Pass launched new game titles and deals for October, and Google Pixel 8 Pro pre-orders were canceled due to performance and pricing concerns. Additionally, Apple is working on a smaller and lighter version of their Vision headset. Small businesses experienced lasting effects after their products went viral, and Mexican liquors and beers are growing in popularity in the U.S. Metro Bank in the UK is facing financial challenges and looking for potential buyers.

Looking ahead, some of the upcoming economic data that we should watch out for next week include the release of Wholesale Inventories MoM, Core PPI MoM, PPI YoY, and Industrial Production YoY in the US. Expectations are for a decrease in Wholesale Inventories MoM, an increase in Core PPI MoM, a moderate rise in PPI YoY, and a significant improvement in Industrial Production YoY. Any surprises towards the upside or downside in these data could cause fluctuations and should be monitored closely.

Essential Charts