FUNDAMENTAL REVIEW FOR THE WEEK (28 October - 1 November 2024)

The current week opens on a positive note after the Israeli attacks on Syria and Lebanon on Saturday did not hit Iran's oil and nuclear facilities. The reduced risk of a major conflict weighed on oil prices, but the dollar remained strong, helped by a weaker Japanese yen following the ruling Liberal Democratic Party's loss in the Japanese elections.

The coming week will feature a number of key macroeconomic data, as well as earnings from major US tech companies. Investors will be closely monitoring financial data that could directly impact the US Federal Reserve's decisions at its meeting on November 7. At the same time, the US presidential election on November 5 adds additional significance to these macro data.

Key economic releases for the US will be:

• JOLTs Labor Market Report (Tuesday),

• Q3 GDP Preview (Wednesday),

• PCE Inflation Index (Thursday),

• Nonfarm Payrolls (Friday).

The October nonfarm may be weak, which will logically be associated with the recent hurricane aftermath and strikes. If the data is lower than expected, the market may react with a fall in the dollar, but rather in the short term. However, a strong report will spark discussions about possible economic overheating and reduce the likelihood of the Fed cutting rates before the end of the year.

As noted earlier, this week, investors' attention is also focused on the reports of the largest technology companies - the so-called "magnificent seven". Strong financial results can cause growth in stock markets, although investors will be ready to immediately take profits before the elections. If the reports come in below expectations, it is possible that the US market will go into correction without an extreme wave of growth.

The end of the month, as well as the onset of a “quiet period” for the Fed, excluding speeches by its representatives, create conditions for investors to actively close risky positions before important political and economic events next week.