This week in the markets: can the winning streak go on?

Around a fifth of companies in the S&P 500 are due to report this week, likely testing the market’s six week-long winning streak as gold surges and UK investors brace for incoming tax rises in the Budget next week.

• 10 things to look out for in the Autumn Budget

Can US earnings live up to expectations?

The S&P 500 hit another all-time high on Friday, ending the week 0.85% higher than it started and cementing the sixth straight week of positive gains. That’s the US market’s best run of 2024 so far.

A big test arrives this week, however, with around 20% of S&P 500 companies reporting before close-of-play on Friday. According to US data analyst FactSet, 79% of companies that have reported so far this earnings seasons have beaten expectations - but often only by small margins.

The market’s high level will no doubt be on the mind of investors, especially with the big variables at play right now. The US election remains knife-edge and the conflict in the Middle East continues to widen with no obvious path to de-escalation.

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Gold high a sign of nerves

Those nerves are perhaps showing up in the new high achieved by gold, even if stock markets seem untroubled. Gold prices reached $2,729 per ounce on Monday after hitting an all-time high of $2,732 earlier.

Gold is considered a safe investment during times of economic and political turmoil and the price has been rising in line with tension in the Middle East. Also helping are lower interest rates because they reduce the opportunity cost of holding gold, which produces no income. Interest rates are now falling in major economies, with further cuts expected in the UK and US in November.

China is also cutting, and reduced its benchmark lending rates further on Monday following reductions to other policy rates last month as part of a package of stimulus measures to revive the economy.

• Gold price: the latest analysis and our fund picks

Oil weakness and Budget fears stalk UK

In the UK, the FTSE 100 was roughly flat by mid-morning on Monday, after suffering losses on Friday.

Recent oil price falls have been a headwind for the commodity-heavy UK index. Oil suffered a more than 7% drop last week on worries about demand in China, the world's top oil importer, and an easing of concerns about potential supply disruptions.

Oil, then, seems to be another signal that financial markets are not yet worried about conflict in the Middle East. Not yet, at least.

Closer to home, many investors are focused on the Budget which will take place on Wednesday of next week. The Government has given warning that taxes are likely to rise in some areas and the savings and retirement regime is one area expected to become less generous.

Making employer pension contributions subject to National Insurance is one of the rumoured changes that is gaining traction, despite claims from critics that it would breach Labour’s pre-election promise not to rise either of National Insurance, VAT or Income Tax.

That promise has meant the burden of raising revenue is likely to fall heavily on other taxes, with Capital Gains and Inheritance two areas that the Chancellor Rachel Reeves could look to. Reports last week suggested CGT on the sale of shares could rise to 24% to bring it into line with the rate for sales of second properties.

• Autumn Budget: how Labour might change CGT

For IHT, the rule that allows gifts to become free of IHT after seven years could be tightened so that 10 years must pass before a gift falls outside of an estate. The Chancellor could also crack down on the rules which allow wealthy people to give away significant sums as long as these are made from their regular income.

• Autumn Budget: how Labour might change IHT

Finally, a suspension of stamp duty on the purchase of homes up to a value of £250,000 could be ended, meaning the tax applies on values above £125,000.

Important information - investors should note that the views expressed may no longer be current and may have already been acted upon. Overseas investments will be affected by movements in currency exchange rates. Investments in emerging markets can be more volatile than other more developed markets. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice.