Weekly Market Outlook

September 18, 2023
Chief Global Investment Strategist Jeffrey Kleintop’s 90-second take on the markets for the week ahead.

[Screen shows "Weekly Market Outlook with Jeffrey Kleintop"]

[Jeff holds up illustration of a sign labeled "Jackson Hole"]

From the Fed's annual economic symposium in Jackson Hole, to the loan rate adjustments in China, to the first take on Europe's August economic readings, I'm Jeff Kleintop with 90 seconds on what you need to know for the week ahead.

The big event this week is the Kansas City Fed's annual economic policy symposium which kicks off in Jackson Hole Wyoming on Thursday, features dozens of central bankers and policymakers from around the world. On Friday, all eyes will be glued on Fed Chair Powell and ECB President Lagarde as they address the conference. Both central banks are expected by the market to be on hold in September, potentially ending their most aggressive rate hike cycles in decades. Any signal that this could change or how long it may be until rate cuts take place could move the markets.

Now, even as recent US GDP estimates have ticked up, China's lingering economic downturn

[Jeff holds up illustration of a rabbit and turtle labeled "Different Speeds"]

has been the focus of investors lately—particularly the weakness shown by Chinese consumers, the second largest consumer market in the world for a wide range of products from cars to cosmetics. Chinese banks are likely to lower their loan prime rates by 15 bps on Monday. And this will trim costs for corporate and mortgage loans for a second time in three months after the People's Bank of China eased policy in response to the sharp economic downturn. The economy needs support, with activity slumping and the housing downturn deepening.

Wednesday's preliminary PMI readings from the US, France, Germany, the Eurozone and the UK will give a health check on the global economy in August. In particular,

[Jeff holds up illustration of a factory building with smoke stacks]

market participants will probably focus on the extent to which deterioration is visible beyond the well-known weakness in the manufacturing sector as the lagged impact of rate hikes is increasingly felt. The July figure was below the April to June average, suggesting GDP growth in Europe was decelerating at the start of the third quarter. In fact, the reading for July was consistent with the economy contracting by 0.2%.

[Jeff holds up a note with the words "Thank you"]

Thanks for watching.

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Weekly Market Outlook

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Get Schwab's view on international markets. 

Quarterly Market Outlook: A Delicate Balance

The Federal Reserve weighs the data while investors wonder: Is the rate-hike cycle over?

Schwab Market Perspective: Tension

Competing narratives have emerged to describe the state of the U.S. economy.

Europe Sentiment: So Bad It's Good

Changes in sentiment may drive the performance of the eurozone equity markets, even with disappointing economic data.

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