July 1, 2024
United States:
Big Names in S&P 500 Overshadow the Risk of a Volatility Jump
Shares of the largest US companies are moving wildly out of sync, creating a sense of calm in the S&P 500 Index not seen in years. But it’s a different story when it comes to the rest of the market.
While a Cboe gauge of implied correlation for the 50 largest S&P 500 stocks has recently hit a record low, the equity index’s equal-weighted counterpart is close to the 64th percentile relative to the past year, according to an analysis from Susquehanna International Group. That dynamic signals that even though the big names are trading more independently, investors see the others moving much more in tandem.
Europe:
German Inflation Slows as Optimism in Economic Rebound Wanes
German inflation slowed after two months of accelerating as the country’s economic recovery showed signs of stalling.
Consumer prices rose 2.5% from a year earlier in June — down from 2.8% in May and in line with a Bloomberg survey of analysts. Energy costs continued to decline, while goods eased and services, under particular scrutiny now, were unchanged at 3.9%.
Asia:
Japan’s Wavering GDP Revisions Leave Investors Unimpressed
Japan’s government statisticians again revised the nation’s growth figures to show that the economy shrank at the start of the year more than previously reported, an additional tweak that casts further doubt on the reliability of initial figures.
Gross domestic product shrank at an annualized pace of 2.9% in the three months through March, the Cabinet Office said Monday, compared with a 1.8% retreat reported earlier. Economists say the weaker result may support a downward revision of the central bank’s annual growth forecast, though the likelihood of the Bank of Japan raising interest rates again this year remains largely unchanged.
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