Contrary to expectations, the markets have continued to rise moderately or, at least, have stabilised somewhat despite very narrow volumes which are, by definition, fairly dangerous. Remember the surprise devaluation of the yuan in the middle of August last year which initiated a major destabilisation phase in the markets. This subject has become less relevant. Today, European banks and petrol are having the greatest impact on investors’ perceptions of (multiple) risk(s).
From a macroeconomic standpoint, American, Chinese and European growth have continued so far, although Brexit is already casting a shadow on 2017 for both Great Britain and its European partners. As long as global growth doesn’t collapse, investors can still hope for good returns via dividends paid by companies or an increase in profits if their stock picking is fruitful. September will see the last half-year publications, however, savers will already have moved on to other concerns. The fourth quarter will be studded with international political deadlines including the presidential elections in the United States and the referendum on the Italian electoral system. The Syrian conflict continues to worsen and tensions between related Slavic peoples (Russians and Ukrainians) have still not calmed down.
The picture doesn’t appear very positive at first glance, but given all of the catastrophes announced for months now, the stock markets in both the United States and Europe have provided good performance potential during a year which will, no doubt, continue to be complex for asset managers.
Igor de Maack, Fund manager and spokesperson at DNCA. This article was finalised in August 12th, 2016.
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