The financial markets are currently defying the usual summer slump. With the attempted assassination of Donald Trump, Joe Biden's withdrawal from the race for the US presidency, the massive sector rotation, the heavy losses in the previous winners of the current year such as technology or in the Japanese Nikkei, there was plenty to talk about for all investors who didn't go on holiday.
Revival of the outperformed defensive stocks
However, this was not the only reason for movement on the stock markets. Due to the 3% lower inflation figures in the USA and the sudden weakness in the US labour market (4.3% unemployment), the market has, on the one hand, once again priced in more future interest rate cuts by the US Federal Reserve. On the other hand, however, economic fears are also weighing on cyclical companies. Since the publication of the inflation figures on 11 July, for example, defensive consumer goods have risen by 3%. This is in contrast to the largest American IT stocks, which have lost 10% on average. Nevertheless, the market breadth has improved as a result, which can be interpreted as a positive signal.