1. China National Congress. The week-long National Congress of the Chinese Communist Party (Congress) began on 16 October. This gathering takes place every five years and is expected to re-appoint Xi Jinping as the president for a new term of five years. The Congress will also appoint a new premier, as Li Keqiang is stepping down. From an investor’s perspective, attention will focus on policy measures after the Congress concludes. It is believed that more substantial policies to stimulate growth have been held back until Xi Jinping is reappointed. While investors will likely welcome more aggressive policy easing, it is taking place against a backdrop of slowing global growth, weak domestic consumption due to China’s zero-Covid policies and US lawmakers’ hawkish stance toward access to key technologies that China needs to accelerate growth. While China still has policy levers to pull, the global backdrop could dilute their impact.

2. Brazil elections. The first round of elections produced no single candidate with more than 50% of the vote, which means the two candidates with the highest share of the vote will progress to a second round on 30 October. Jair Bolsonaro, the incumbent president, will face his rival Luiz Inacio Lula da Silva in the runoff. Investors should look through the elections and focus on market-friendly developments in the coming 12 months. The potential for interest rate cuts in 2023 stands out given the central bank hiked interest rates ahead of most other central banks globally, and inflation may have recently peaked. If inflation continues to trend down, there is room for a less restrictive monetary policy, with a positive impact on the Brazilian stock market.

3. Oil prices. Oil prices have been steadily declining since their peak on 8 March following Russia’s invasion of Ukraine. Relative to the $68.1 average price of West Texas Intermediate (WTI) crude oil in 2021, prices have averaged $98.1 year-to-date, an increase of 31%. Looking ahead, the decision by the Organization of Petroleum Exporting Countries (OPEC) to cut output, may support prices in the short term. However, with a global recession looking increasingly likely in 2023, it is difficult to see oil prices remaining elevated for a prolonged period.

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