The News Said Stocks Fell 2%. Your Savings May Have Lost More.

The Big Story: The News Said Stocks Fell 2%. Your Savings May Have Lost More.

Most people’s savings follow whatever they bought while it was rising, and for years that has been American technology. The Nasdaq, home to most of the big tech names, lost about 4.5% last week, more than twice the headline fall.

Chipmakers did worst. They fell eight days in a row, their longest losing run since 2008, on doubts about how long spending on artificial intelligence can last.

Other parts of the market rose. Shares in companies selling food, medicine and household goods went up, and so did European shares, which hold far fewer tech names. Bonds gained too. Money spread across all of that had something climbing to set against the slide.

Take Luca, an Italian commercial manager at an oil company in Abu Dhabi. His salary arrives in dirhams and his pension waits in Italy. His savings went into an American tech fund through an app, because that was what kept going up. Last week oil climbed and his employer had a good week. His savings had a bad one.

Luca’s job is already a bet on oil, and his savings are a second bet, on one corner of one country’s stock market. A spread-out portfolio covers the rest of the world: many countries, many industries and some bonds, held in Irish-domiciled accumulating funds, which spare a non-American the US estate tax that American-listed funds can carry.

If most of your savings sit in one fund you bought because it kept rising, working out what a spread-out version looks like is a half-hour conversation. Book a time here.

What Else Is Moving

Oil climbed close to $110. Brent crude, the global benchmark, rose about 5% on the week and touched $110 for the first time since May. Oil moving through the Strait of Hormuz is still well below its pre-war level, and attacks on ships near the strait reached their highest count since the war began in February.

American prices rose faster than expected. Prices rose 3.7% in the year to September, and petrol made up more than half of the month’s increase. The Federal Reserve decides on 28 October. On Friday its chair, Kevin Warsh, said “I don’t prejudge meetings” and gave no hint. Traders scaled back their bets on a rise in October, though most still expect one by December.

Wednesday sets Britain’s state pension rise. UK inflation for September comes out on 21 October, with forecasts around 3.4%. Under the triple lock, wage growth of 3.9% sets April’s rise unless prices beat it. Abroad, the rise is paid only in Europe’s single market area, Switzerland and a short list of agreement countries. Pensioners in Malaysia, Singapore, Thailand or the Gulf get none.

Malaysia’s economy beat forecasts. It grew 5.3% in the third quarter from a year earlier, near the top of economists’ forecasts, led by factories making electronics for export. Growth over the first nine months now runs above the government’s own range for the year. The ringgit firmed on the news, though against the dollar it has barely moved since mid-September.

The Expat Takeaway

A tech slide, dearer oil and two inflation reports made for a loud week. A long-term plan needs very little from it.

Weeks like this show what a portfolio actually holds. A spread-out one had parts that rose while tech fell. One built on a single theme fell with it.

One question: if the fund you hold most of fell by a fifth, would your plans for the next five years change?

The slide has a useful side. Monthly savings into a spread-out portfolio now buy the parts that fell at lower prices than a fortnight ago, with no need to pick the moment. If your answer comes easily, this is a week to watch. If it doesn’t, the work was never about chips.