September has quickly proved to be more interesting than the usual lull in August.

After cruising to a series of new highs through August, the NASDAQ Composite cracked at the beginning of September and suffered a sharp set-back. By the beginning of the month, the Index was up 34% over the year (crisis? what crisis?) led by tech: Apple, Amazon, Facebook and, most notably, by Salesforce, which reported a bumper quarter and rosy outlook, leading to a 26% jump in their stock price on the day. After the 10% move in Apple’s stock price at the end of July, it had carried on to gain a further 30% to the peak on 2 September prior to an 18% correction over the ensuing week, heady stuff for a company of this scale. The correction in the NASDAQ (a quite satisfactory 10% fall), took the S&P 500 with it, though the focus was on the tech stocks.

Last month’s edging-up in interest rates continued in the US with the ten-year up to 67bp, having touched 75bp, and the long-bond (thirty-year) to 142bp. In the UK, it looked to be more of a false dawn as the 10-year reached 34bp but then sank all the way back to 18bp. Credit markets are coming back to life again with a series of new offerings coming to the markets (and corporate activity looks to be picking-up again in the equity markets).

Of course, the UK is now heading back into a dreary Brexit argument again, most visible in the gyrations in sterling, which moved between highs around $1.35 and lows around $1.28. Presumably this is all part of a ‘negotiation’ over final terms with the EU, but it does not make for edifying viewing or reflect well on our international standing. The US dollar continues to feel steadier after the summer falls and economy activity is picking-up again though hampered by the upsurge in COVID cases. Oil prices do not reflect this, having drifted off again (possibly more a reflection of a lack of commitment amongst OPEC members), but copper prices have continued to move up, now being markedly higher than the turn of the year. Once again, the UK appears to be a laggard in the recovery, hampered by Brexit and COVID uncertainty.

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