GLOBAL
MARKET
COMMENTARYWEEK 40 = WEEK ENDING 4 OCTOBER 2024

EQUITY

CLOSING
LEVEL
VALUE

MSCI World Index

3,698.41-0.76% Bloomberg Global Agg USD

480.62 q-1.75% Global Property

6,307.29 q-2.16%

S&P 500

5,751.07

0.22% Bloomberg Global High Yield USD

1661.04 q-0.38% Gold2,653.60 q-0.17%-2.06% Bloomberg Global Credit USD

288.87 q-0.71% Oil

74.38 p9.09%

557.37 p

4.59%

MSCI Eur xUKFTSE 100qp
206.13 q
8,280.63 q

WTD% CHANGE BONDS-0.48%

CLOSINGLEVELVALUE

WTD REAL ESTATE &% CHANGE COMMODITIESCommodities

CLOSING
LEVEL
VALUE

WTD
% CHANGEHighlights•

The MSCI World Index fell 0.8%, ending three consecutive weeks of gains, impacted by the Middle East conflict.

•Market expectations of another 50 basis point (bps) rate reduction by the Federal Reserve (Fed) were dashed bySeptember non-farm payroll figures that smashed through expectations.

•In Europe, inflation fell below the European Central Bank’s (ECB) 2.0% target, according to preliminary estimates.

•Oil prices soared, benefitting energy shares, amid increasing retaliatory action between Israel and Iran. Markets
awaited Israel’s response to a direct missile attack by Iran with mounting fears over the prospect of a regional war.

The services PMI dropped to 46.4 from 47.8. due to weak
demand. The composite was 47.0 versus August’s 47.8.

Market commentary

North America: The S&P 500 Index edged up 0.2%.
Energy was by far the best performing sector, rebounding
following missile strikes in the Middle East. Real estate was
the worst performer, giving up some of its recent gains. Ineconomic news, robust non-farm payroll figures put paid tohopes of another 50-bps rate cut by the Fed (see chart).
The 254,000 jobs created in September was far above the150,000 expected, In addition, the previous month’s total
was revised upward while unemployment unexpectedly
dropped in September to 4.1% from 4.2%. However, factoryorders disappointed, recording a 0.2% decline in August
versus the 0.1% rise expected and July’s 4.9% increase.
The ISM Manufacturing Index was unchanged inSeptember, at 47.2, below the 47.5 expected and remaining
in contractionary territory. In contrast, the ISM Services
Index improved to 54.9 from 51.5, above the 51.7 forecast.
Elsewhere, the manufacturing purchasing managers’ index(PMI) for September was revised up, to 47.3 from 47.0
while the services and composite were both revised down,
to 55.2 from 55.4, and to 54.0 from 54.4, respectively. InCanada, the manufacturing PMI was 50.4 in September, up
from 49.5 and entering expansionary territory on healthier
new orders and employment. Manufacturers cited improving
domestic conditions while foreign demand showed evidenceof softening, impacted by uncertainty over the US election.

Continental Europe: The MSCI Europe ex UK Index fell
2.1%. All sectors suffered losses apart from energy, which
made gains amid rising concerns over the impact on oil
supplies from the Middle East conflict. In economic news,eurozone inflation eased to 1.8% YoY in September from
2.2% in August, according to flash estimates, in line withexpectations. The outcome was largely driven by a fall inenergy prices. Germany’s inflation rose 1.6% YoY, versus a
1.9% increase the previous month, lower than market
expectations of 1.7%. The ECB expects inflation to increase
towards year-end, as falls in energy prices roll off. Theeurozone manufacturing PMI for September was revised
upwards to 45.0 from a flash estimate of 44.8, and theservices PMI was updated to 51.4 from 50.5. The composite
was adjusted upward to 49.6 from 48.9. Germany’s
manufacturing PMI was revised up to 40.6 from 40.3. The
services PMI was finalised at 50.6. France’s manufacturing
PMI was revised upwards to 44.6 from 44.0; the services PMI
was updated to 49.6 from 48.3.

UK: The FTSE 100 index was 0.5% lower over the week. Oilcompanies were the best performers, with BP and Shell bothup over 6.0%, benefitting from climbing oil prices. In
economic news, GDP growth for the second quarter wasrevised lower to 0.5% QoQ (0.7% YoY) from earlier estimatesof 0.6% (0.9%). The manufacturing PMI was confirmed at
51.5 in its final reading for September, while the services PMI
was revised downwards to 52.4 from 52.8. Elsewhere, data
showed construction activity grew at its fastest pace in morethan two years in September. Meanwhile, house prices rose
3.2% YoY in September, boosted by lower mortgage rates,

Russell Investments / Global Market Commentary / Week 40 – Week ending 4 October 2024

according to mortgage provider Nationwide. This was well
above the 2.7% market forecast and August’s 2.4% increase.

back into contractionary territory at 49.3. PMI data also
weakened slightly in India but strengthened in Brazil. In
South Africa, the manufacturing PMI jumped to 52.8 – itsstrongest since April – with sentiment aided by lower global
interest rates. Elsewhere, inflation softened more than
expected in South Korea to 1.6% YoY in September, which
supported expectations of domestic rate cuts.

Japan: Japan’s share market weakened, with the TOPIX
declining 1.7% amid heightened tensions in the Middle East,
which raised concerns over fuel supply as well as the global
economy. In terms of economic data, the Tankan Large
Manufacturers business sentiment indicator for the thirdquarter remained at 13, matching expectations. The country’s
consumer confidence index inched higher to 36.9 in
September from 36.7 in the previous month. Meanwhile, themanufacturing PMI for September was revised higher to 49.7
from an earlier estimate of 49.6, while the services PMI wasrevised lower to 53.1 from 53.9.

Fixed Income: The Bloomberg Global Aggregate index
fell by 1.8% over the week. Indications from the Fed thatany rate cut ahead is likely to be smaller than the recent 50bps cut, and robust jobs data sent longer term Treasury
yields higher as markets recalibrated interest rate
expectations. The yield on the 10-year Treasury hit a twomonth high, near 4.00%, before ending the week at 3.97%,up 22 bps. In the investment grade market, issuance wasoversubscribed while risk-off sentiment prompted by theMiddle East conflict weighed on high yield. In Europe,
underwhelming PMIs and inflation falling below the ECB’s
target cemented hopes of a 25 bps rate cut at the bank’s
meeting on 17th October. Over the week, the yield on 10year German bunds rose eight bps to 2.21%. In the UK, theBank of England governor, Andrew Bailey, said in aninterview that the bank could become “a bit more activist” inlowering rates if inflation stayed as expected, adding thatcost of living pressures had not been as entrenched asanticipated. However, the bank’s chief economist seemed tocontradict this message a day later warning against
lowering rates too quickly. The yield on 10-year gilts rose toits highest since late July on the US jobs report, before
ending the week up 15 bps at 4.13%.

Asia Pacific: Asian share markets were subdued with
Chinese markets closed for most of the week due to the“Golden Week” national holiday. The MSCI Asia Pacific exJapan Index ended the period up 0.8% with the advancedriven mainly by Hong Kong’s Hang Seng index which
continued to benefit from the Chinese government’s recent
pledges of stimulus measures. In contrast, share markets
declined in Taiwan and South Korea amid a shortened
week due to Typhoon Krathon and a public holiday,
respectively. Share markets in Malaysia and Indonesia also
finished lower. In Australia, stocks trended lower, with theAll-Ordinaries Index declining 0.7%.

Emerging Markets (EM): The MSCI EM Index climbed
for a fourth-successive week with a 0.4% increase. Positive
performance from China-based names within the consumer
discretionary and communication services sectors
underpinned returns – despite the mainland market being
closed for the “Golden Week” holiday. Sentiment remained
buoyant following the accommodative government andcentral bank policy updates the week previously.
Domestically, the Caixin PMI data for China weakened in
September; the manufacturing measure notably slipped

Commodities: Commodities were mixed. In a marked
turnaround, oil prices soared 9.1% in the biggest weekly
rise since October 2022, due to the escalating conflict in theMiddle East and the potential impact on supplies (seechart). Copper and gold fell after three weeks of gains.
Copper was 0.4% lower while gold edged down 0.2%.

Charts of the week
US Non-farm Payrolls Far Above Expectations

Oil Prices Soar on Esclalating Middle East Conflict

The number of new jobs added to the US economy in
September was the highest since March, well above
forecasts, denting hopes of another bumper Fed rate cut.

In contrast to recent weakness, oil prices climbed amid
rising concerns over oil supplies amid the escalating
conflict between Israel and Iran.
West Texas Intermediate Oil

US Non-farm Payrolls

90600
55085500
45080

Price per barrel ($)

Non-farm Payrolls (000s)

400
350

300
250
200

75

70

150
100

65

50060

Sep 22

Nov 22

Jan 23

Mar 23

May 23

Jul 23

Source: Bloomberg as at 04/10/24

Sep 23

Nov 23

Jan 24

Mar 24

May 24

Jul 24

Sep 24

Jan 24

Feb 24

Mar 24

Apr 24

May 24

Jun 24

Jul 24

Aug 24

Sep 24

Oct 24

Source: Bloomberg as at 04/10/24

Russell Investments / Global Market Commentary / Week 40 – Week ending 4 October 2024

/2Market Data – Base Currencies
Value

WTD

MTD

YTD

12M

Fri, 04-Oct-24% CHANGE% CHANGE% CHANGE% CHANGE

MSCI World Index

3,698.41-0.76%-0.66%

16.70%

31.58%

S&P 500

5,751.07

0.22%-0.20%

20.57%

34.88%

Russell 1000

3,140.37

0.23%-0.15%

19.76%

34.54%FTSE 100

8,280.63-0.48%

0.53%

7.08%

11.71%

206.13-2.06%-1.07%

7.43%

17.92%

DAX

19,120.93-1.81%-1.06%

14.14%

26.63%

Topix

2,694.07-1.71%1.82%

13.85%

21.42%MSCI APAC xJP

624.49

0.75%

0.59%

18.08%

30.36%

Hang Seng Index

22,736.87

10.20%

7.59%

33.37%

32.22%MSCI Emerging

1,179.34

0.41%

0.73%

15.20%

27.10%

Australia All Ordinaries

8,416.58-0.71%-1.43%

7.50%

18.84%

S&P/TSX Composite Index

24,162.83

0.86%

0.68%

15.29%

26.94%

BONDS (10YR, Yield in %)EQUITYMSCI Europe xUK

4-Oct-24

27-Sep-24

30-Sep-24

31-Dec-23

4-Oct-23

US

3.97

3.75

3.78

3.88

4.73

UK

4.13

3.98

4.00

3.54

4.58

Germany2.21

2.13

2.12

2.02

2.92

Japan

0.89
4-Oct-24

0.85
WTD% CHANGE

0.86
MTD% CHANGE

0.61
YTD% CHANGE

0.81
12M% CHANGE

Bloomberg Global Agg USD

480.62-1.75%-1.58%

1.96%

11.39%

Bloomberg Global Agg Hedged USD

582.26-0.71%-0.60%

3.76%

10.73%

Bloomberg Global High Yield USD

1,661.04-0.38%-0.42%

9.14%

20.27%

Bloomberg Global Agg Credit USD

288.87-0.71%-0.64%

4.42%

12.92%

Bloomberg Global Agg Corporate USD

283.51-1.35%-1.21%

4.05%

14.57%

Bloomberg US Agg TR USD

2,235.47-1.24%-1.01%

3.40%

11.37%

Bloomberg US Corp High Yield USD

2,673.86-0.15%-0.17%

7.82%

17.06%

Bloomberg European Agg EUR

242.54-0.28%-0.36%

2.12%

9.62%

Bloomberg European Agg Corp EUR

255.29-0.10%-0.18%

3.65%

9.99%

Bloomberg Pan European High Yield EUR

469.55-0.00%MTD% CHANGE

6.99%
YTD% CHANGE

13.71%
12M% CHANGE

FIXED INCOME

COMMODITIES

4-Oct-24

0.03%
WTD% CHANGE

Global Property

6,307.29-2.16%-2.11%

10.27%

31.26%

Gold

2,653.60-0.17%

0.72%

28.63%

45.69%

West Texas Intermediate Oil

74.38

9.09%

9.11%

5.28%

0.15%

Commodities

557.37

4.59%

4.60%

4.06%

-3.86%ECONOMIC & MARKET INDICATORS

4-Oct-24

27-Sep-24

30-Sep-24

31-Dec-23

4-Oct-23

ICE Libor USD 3M

4.85%

4.85%

4.85%

5.59%

5.68%

ICE Libor GBP 3M

5.30%

5.30%

5.30%

5.32%

5.42%

ICE Libor EUR 3M-0.58%-0.58%-0.58%-0.58%-0.58%Fed Policy Rate

5.00%

5.00%

5.00%

5.50%

5.50%

BOE Policy Rate

5.00%

5.00%

5.00%

5.25%

5.25%

ECB Policy Rates

3.65%

3.65%

3.65%

4.50%

4.50%

Notes: Unless otherwise stated, data sourced from Bloomberg as of 4th October 2024. Equity Index returns in base currency, except for APAC xJP (USD) andEmg Mkt (USD), percentage change in price levels as at 4th October 2024. Generic Government Bonds, 10Y yield in % shown. Fixed Income indices in USD,Total Return, and Hedged ICE Libor and policy rates in percent. Currently data shows spot exchange rates. Global Property sho ws FTSE EPRA/NA REIT DevTR USD. Gold in $/Oz. Oil WTI $. Commodities show S&P GS Commodity Index, USD.

Russell Investments / Global Market Commentary / Week 40 – Week ending 4 October 2024/3

Equity Indices Fundamentals
VALUE

EARNINGS PER SHARE (EPS)

PRICE-TO-EARNINGS (P/E)

RETURN-ON-EQUITY (ROE)

Index

04.Oct.24

TRAILING
12M

EXPECTEDCURRENT YEAR

LTGROWTHRATE

CURRENT10Y
AVERAGECURRENT10Y
AVERAGEMSCI World

3,698.41

172.55179.71

12.39%

21.43

18.21

14.03%

11.20%

S&P 500

5,751.07

233.17241.8713.08%

24.6719.28

17.82%

14.70%

Russell 1000

3,140.37

128.51130.5813.13%

24.44

19.73

16.55%

13.88%FTSE 100

8,280.63

682.99673.88-24.60%

12.12

14.09

10.00%

8.94%

206.13

13.44

13.19

7.29%

15.33

16.70

12.11%

8.57%

DAX

19,120.93

1,371.04

1,334.89

26.92%

13.95

14.45

9.32%

9.45%

Topix

2,694.07

172.09180.72

13.53%

15.65

17.53

8.56%

7.78%

624.49

35.62

40.18

26.33%

17.53

15.05

10.25%

10.92%

Hang Seng

22,736.87

1,960.02

2,107.80-7.47%

11.60

11.62

10.12%

11.01%MSCI Emerging Markets

1,179.34

73.41

83.33

16.00%

16.06

13.50

11.11%

11.24%MSCI Europe xUKMSCI APAC xJP

Notes: Unless otherwise stated, data sourced from Bloomberg as of 4th October 2024. Returns in base currency, except for APAC xJP (USD) and Emg Mkt(USD). Trailing 12-month Earnings per share (EPS): Market convention index earnings calculated by summing up the equity member EPS contributions for t helast 12 months multiplied by the #shares and then divided by the index divisor sum. Expected current year EPS: index general estimated earnings for thecurrent fiscal year based on the best estimates for each member. EPS LT growth rate: The estimated index long term growth rat e of EPS is a weighted
average of the underlying members estimated long term growth forecasts during the ne xt business cycle, normally 3-5 years, computed by summing all
members' growth EPS forecasts multiplied by their respective index weight. and implementation. Price -to-Earnings (P/E): Index estimated P/E Current Year,calculated as Last Price divided by estimated earnings full one year. Return-on-Equity: Index estimated measure for constituents' profitability revealing how
much profit a company generates with the money shareholders have invested, in percentage.

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Russell Investments / Global Market Commentary / Week 40 – Week ending 4 October 2024/4