Investments & Economy The Week Ahead

The Week Ahead – Olé!

Welcome to “The Week Ahead” where each Friday we take a moment to provide our thoughts on what we can expect in markets and the economy for the upcoming week.

Looking beyond our borders next week, investors will be focused on the upcoming European Central Bank meeting next Thursday. Their current asset purchase program is scheduled to expire in December and expectations are that the ECB will implement a tapering program versus a hard stop. Just a month ago many economists had been expecting the tapering program announcement at next week’s meeting, however, due to a strengthening Euro and continued weak inflation, the timeline has been pushed to October. Just as we expect rates domestically to increase over time, we expect global rates to follow in a similar path as the ECB begins tapering and eventually raising key interest rates.  

 

Sticking with global economies, global PMI manufacturing surveys were released this morning and of the 25 regions that have reported so far, 19 saw improvements in their manufacturing sectors in August. More importantly, 24 of the 25 countries showed readings of continued manufacturing expansion.

 

For the last two years we have been bullish on international equities and, given the current financial conditions, continue to remain bullish as we expect the ECB the execute the Fed’s playbook thoughtfully. As global central banks move forward with normalization and volatility increases from historic lows, we continue to emphasize holding additional dry powder and maintaining a diversified portfolio.

 

Data deck for September 2 – September 8:

 

Date

Indicator

Period

September 5

Factory Orders

----

September 6

Trade Balance

July

September 6

ISM Non-Manufacturing Survey

August

September 6

Fed Beige Book

----

September 7

Initial Jobless Claims

----

September 7

Non-Farm Productivity

Q2

September 7

Unit Labor Costs

Q2

September 8

Wholesale Trade

July

September 8

Consumer Credit 

July

 

 

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Andrew Chan, CAIA, Portfolio Strategist
About the Author
Andrew Chan, CAIA, Portfolio Strategist
Mr. Chan serves on the investment team and is responsible for conducting investment manager research and portfolio construction. As a member of the investment committee, he provides market commentary and investment insights. Mr. Chan’s responsibilities include overseeing client portfolios, calculating risk metrics, conducting the rebalancing of client portfolios, and evaluating the selection of new investment managers. With over 10 years of wealth management experience, Mr. Chan has played key roles across various aspects of investment and wealth management. Prior to joining First Foundation Advisors, Mr. Chan was most recently a portfolio manager at U.S. Trust where, in addition to his daily responsibilities, he served on numerous internal committees including the investment manager committee, the portfolio model committee, and the strategic technology committee. He also served on the in-house strategic consultant committee reporting directly to the President of U.S. Trust. Mr. Chan is a graduate of the Wharton School Executive Program on Investment Management and holds a Bachelor of Arts degree in Business Administration from the University of California, Riverside. He is a Chartered Alternative Investment Analyst (CAIA). Mr. Chan serves on the executive board for CAIA Los Angeles and is the Interim President for the association. Read more