Looking back at the markets through July

A selection of articles looking back through the markets last month.   Global market review Possibility of “no deal” moves closer Boris Johnson beat Jeremy Hunt during July to become the new leader of the Conservative Party and the UK’s new Prime Minister. The new Government’s harder-line approach to Brexit – and the increased prospect … Continue reading “Looking back at the markets through July”

What lies in store for equities?

The first half of 2019 was characterised by the strongest and most broad-based asset price reflation that we have seen since 2009. It is clear that this pace of gains cannot continue through the second half of the year. Bad news has been good news for stock markets for quite some time.  That’s because investors … Continue reading “What lies in store for equities?”

Looking back at the markets through June

A selection of articles looking back through the markets last month. Brexit: no further forward   Global market review The third anniversary of the Brexit referendum came and went in June, and still the issue of Brexit remained up in the air. As the clock ticked towards the extended deadline of 31 October, the Conservative … Continue reading “Looking back at the markets through June”

Waiting for a new interest rate policy

The Federal Reserve Board is re-thinking its whole approach to setting interest rates and controlling credit and money. Its bruising encounters with a falling stock market and an angry President in the final quarter of 2018 left it at a loss to explain why it needed to take action to ease monetary conditions. It had … Continue reading “Waiting for a new interest rate policy”

Why Emerging Market Debt’s positive start to 2019 can continue

After a challenging 2018 in which emerging market debt (EMD) logged negative total returns, 2019 has begun with an eye-catching recovery. In the case of EMD sovereigns, all the losses of 2018 were erased by January 2019, and most EMD asset classes have added to or held onto their gains since then. So what next? … Continue reading “Why Emerging Market Debt’s positive start to 2019 can continue”

Fed turns more dovish and signals an end to rate hikes

The Federal Reserve (Fed) has lowered its projections for US growth and inflation and reduced its expectations for interest rates. The “dot plot” published after last night’s meeting shows no rate hikes this year and only one in 2020.  Tighter financial conditions At his press conference, Fed chair Jerome Powell said growth was slowing by … Continue reading “Fed turns more dovish and signals an end to rate hikes”

A good start to the year – where next?

As we move into March, global stocks have enjoyed the best start to the year in almost three decades. Does this bode well for the rest of 2019? History suggests it does. Since 1928, a good January/February has led to a positive calendar year over 80% of the time. However, history does not always rhyme … Continue reading “A good start to the year – where next?”

Does the US have enough firepower to fight the next recession?

With interest rates already near record lows, what’s left in the Fed’s arsenal to fight the next recession? Low starting interest rates means that the Federal Reserve (Fed) may need to expand its policy toolkit to fight an economic downturn. But if this proves insufficient, fiscal policy need to pick up the slack. The go-to … Continue reading “Does the US have enough firepower to fight the next recession?”

Avoiding a corporate bond liquidity squeeze

Since the global financial crisis in 2008, aging developed-world populations, record low deposit interest rates and quantitative easing by the world’s major central banks have driven a global ‘search for yield’ by investors. For many years, this drove asset yields lower across the risk spectrum. However, since the start of 2018 the investment backdrop has … Continue reading “Avoiding a corporate bond liquidity squeeze”

Will the world authorities do enough to stimulate their economies?

Markets signalled the slowdown now underway in industrial output and investment with a sharp sell-off at the end of last year. They challenged the Federal Reserve in particular to ease its tough stance, which it duly did as 2019 dawned. US policy is to spend more and tax less, offering some budget boost to the … Continue reading “Will the world authorities do enough to stimulate their economies?”

Reasons to be positive on equities

Investors are quite rightly nervous after sharp market falls in the final quarter of last year. However,  that it’s not all doom and gloom. In fact, there are reasons to be positive. Equities are discounting a recession that is unlikely to happen. Although growth is certainly slowing down, none of the world’s major countries are … Continue reading “Reasons to be positive on equities”

Is the road to inflation taking us back to the 1960s?

The 1960s are remembered for radical social reform, political upheaval and war. Often forgotten is that they were also a time of rising inflation – and in this they may hold disquieting lessons for us today.   One of our key calls for 2018 is that consumer price inflation in the US will become an … Continue reading “Is the road to inflation taking us back to the 1960s?”

New Fed chair Powell raises rates, growth and inflation forecasts

As expected the Federal Reserve (Fed) raised interest rates by 25 basis points at the March Federal Open Market Committee (FOMC) meeting. The move increases the target range for the federal funds rate from 1.25%-1.5% to 1.5-1.75%. At his first FOMC meeting, new Fed chair Jerome Powell also announced that the committee is pushing up … Continue reading “New Fed chair Powell raises rates, growth and inflation forecasts”