#equity-markets

#equity-markets

These institutions are experiencing a golden spring in their businesses. Between Tuesday and Wednesday, Wall Street's biggest banks reported their financial results. These institutions have boosted their profits, exceeding all analysts' forecasts. The sector is experiencing a golden age, thanks largely to the exuberance of the stock market and the boom in corporate dealmaking, despite the uncertainty about the U.S. economy.

On a number of measures, equity market valuations appear stretched, particularly for technology companies focused on Artificial Intelligence, it said. This, when combined with increasing concentration within market indices, leaves equity markets particularly exposed should expectations around the impact of AI become less optimistic.

At its annual jamboree at Jackson Hole, Chair Powell signalled his apparent support for a rate cut later this month, stating that the softening labour market could offset the inflation risks from Trump's tariffs. The market had already been anticipating a 0.25% cut on 17 September but this cemented expectations and last week's crop of US data did little to change things.

The CBI urges bold action to revitalize London’s equity markets, suggesting the removal of share purchase stamp duty and greater flexibility on executive pay.