Over the past week, a slight optimism has crept into the markets that things are not as bad as investors expect. Q3 earnings are so far better than expected. The company that stood out last week was Netflix (part of the Compass Global Trends portfolio), surprising most market participants with results that beat analysts' expectations. Earnings season is now underway and earnings data for the four giants by market capitalization, Microsoft, Alphabet, Amazon, Apple, are to be released. The broad S&P 500 index remains above the psychological zone between 3500 and 3600 points. Its oversold condition makes it extremely sensitive to positive corporate earnings data or any signs of a less aggressive Fed. In the Eurozone, many are expecting a 0.75 basis point increase in key interest rates as inflation approaches 10%.

Bonds

Fixed-income instruments registered a weak week alongside the rapid rise in yields, which momentarily reached 4.34%. This led to a new low in 20+ year bond prices. After the sharp rise, it is likely that we will see a slowdown or some correction in yields, which will be a positive sign for bond prices in the week ahead.

Commodities

Natural gas prices have fallen past the fact that November is shaping up to be warmer than expected. Less demand and more supply pressured blue fuel prices last week. Oil also lost ground, but marginally. The price of black gold has been supported by the production cut that was announced by OPEC.

What's next this week?

This week the US will release third quarter GDP data, which is expected to show a return to growth after the technical recession in the first half of the year. Earnings data for the four market capitalisation giants Microsoft, Alphabet, Amazon, Apple are to be published.

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Disclaimer:
This information is marketing material and does not present investment consultation, advice, investment research, or investment recommendation. The information is valid as of the issue date of the marketing material and may alter in the future. The value of the units in the collective investment schemes changes over time and it could be higher or lower from the value at the time of the investment. No profits are guaranteed and risk exists for the investors to not receive the full amount of their investments. Investments are not guaranteed by a guarantee fund which is created by the country or another form of guarantee. Information on the performance of the financial instruments in the past is not a reliable indicator for future performance. Therefore, it is recommended for investors to acquaint themselves with the Prospectus and the Document with key information for investors before making a final investment decision. You can find these documents in Bulgarian on the website of Compass Invest - www.compass-invest.eu, and you can request and get a free paper copy at the office of the management company at: Sofia, 19 George Washington Str, floor 2, during every business day from 9 am to 5 pm. Future results are subject to taxation, which depends on the personal situation of each investor and may change in the future. A summary of the rights of the investors is available at the following hyperlink in Bulgarian: here. The mutual funds, which are managed by Compass Invest, are actively managed without following an index. We would like to inform you that Management Company Compass Invest can make a decision to terminate the offering of funds on the territory of the Republic of Bulgaria. The investment in units of mutual funds, in addition to benefits, carries certain risks like: liquid, operational, interest, currency, and political risk, as well as macroeconomical risk, currency risk, concentration risk, etc. The full information about risks can be found in the Prospectus of the respective fund.
Risks:
Despite benefits, the investment in shares of mutual funds brings certain risks like:
1) Market risk with the following components: a) interest risk related to a decrease of the value of the investment due to a change of the interest rates levels b) currency risk related to a decrease of the value of the investment, denominated in a currency which is different from BGN and EUR c) price risk related to a decrease of the value of the investment in the case of unfavorable changes of the market’s prices;
2) Credit risk – related to a decrease of the value of the position in the case of unexpected events with a credit nature which are related to the issuers of financial instruments, the counter side of exchange and OTC transactions, as well as countries, in which they operate;
3) Operational risk – from errors or flaws in the system of the organization
4) Liquidity risk – in case of forced sales of assets under unfavorable market conditions;
5) Concentration risk – in case of incorrect diversification of exposures to groups of related clients, from the same economic branch, geographic area, etc.
6) Position risk which is related to the change of price of a certain instrument in result of factors related to the issuer or in case of a derivative instrument – related to the issuer of the base instrument;

Additional information for the risks can be found in the Prospectus of the respective fund, which is available here: www.compass-invest.eu