It may be drawing a long bow but it now seems plausible that, just below the surface, AI inspired optimism has helped markets remain surprising resilient throughout this year, particularly when facing the US regional banking crisis that started in mid-March and more recently the polemic surrounding the US Debt Ceiling.

This week we used a couple of AI programs to produce an AI generated market summary, and then added our own commentary below for comparison.

US inflation moderated, the Federal Reserve temporally paused its rate hiking cycle while consumer sales and sentiment gauges firmed. On the face of it, this looks like an immaculate ‘disinflation’, and the dominant narrative in the press is that a resilient US consumer has fanned hopes of a soft landing.

We had intended to retire the AI but following some quite positive feedback (which we don’t usually get) it gets a reprieve.

Hopes of a soft economic landing permeated markets last week and even the hapless UK market caught a bid late in the week, leaving it up a percent along with the ASX, while Europe, Japan and he US ended the quarter on a high note, up by 2-3%.

Last week we saw some volatility creep into markets as we turned the page on a new financial year. US labour data was mixed but just strong enough to suggest that higher rates might be around for a bit longer. This caused some volatility in bond markets, with short term (2 year) rates up again and hitting 15-year highs.

Markets slid again last week but the selling was concentrated in US tech, most of which is down 10% or so this year. Much of last week’s selling occurred in the last 2 sessions of the week.

Fears of a US recession later this year gathered pace last week and the US equity market jumped by almost 7% and the Nasdaq was up some 9%.

In light of the recent inflation data coming out of the US, we dive in to why the market is so upset about a 0.1% increase in prices, and what this means from an Australian investor's perspective.

During the last few weeks, the prospect of rising interest rate expectations continued to grip markets, as the soft landing/rapid disinflation thesis was tested.

As the world’s elite gathered in a snowless Davos, markets focused on much more immediate concerns, starting with the continuing wave of layoffs in corporate America. Amazon, Microsoft, Alphabet (Google’s parent company), Salesforce and Goldman Sachs, among others, took turns to announce staff cuts. It would appear boardrooms and CEOs are lending some credence to the possibility of a recession in 2023.

Last week the S&P 500 traded in a 3% range, having done a 2% round trip on Thursday, followed by a 3% fall on Friday after the inflation data release and then another almost 2% round trip yesterday. Emerging markets were the worst performing, down 4% for the week. Taking a step back though, most equity markets haven’t given back that much of their gains from January, while Europe and the Nasdaq remain up 10% for the year.

Nathan Fradley explains how the ethosesg technology can help you assess and design an ethical portfolio that aligns to an investor’s personal values.

ETFs that invest in carbon credits are now available. Why should we assume that their price will go up over time? And does buying a carbon credit ETF actually contribute positively to emissions reduction? Will it actually generate the outcome investors are expecting? This article explores the issues around investing in carbon credits.

There are many direct assets and funds that contribute positively to climate action within the InvestSense Better World Portfolios. Meridian Energy is one of the stand-out direct assets in the portfolio with a climate energy focus.

In recent years professional investors have got increasingly used to the fact that good news is bad news for markets because higher interest rates are likely to be necessary, and of course vice-versa. However, last week the effect was stronger than ever and stocks rallied mid-week amidst reports of widespread lay-offs and expectations of a weak US jobs report.

The US market finally market caught a bid last week. Early in the week the market was down few percent after an earnings miss by ad dependent social media platform Snap (of Snapchat fame) combined with weak guidance raised more doubts about the economy and economic resilience of tech companies.

The seventh negative week in a row for the US sent it briefly into official bear market territory before it recovered slightly late on Friday. The world’s largest stocks (Apple, Microsoft Amazon and Google) are all down 25%.

Mark Lewin was a financial planner, but is now the Director of Back Office Heros. In his planning business he gained significant efficiencies by recommending and implementing managed accounts for his clients. He tells us how...