Market Reports

Market Summary – July 2019

19th July 2019

The Author: David Cooper
Financial strategist, investment adviser and Sales Director for United Advisers

Europe leads Global Equity Market increases

Equity markets adopted a slightly more optimistic feel in June, with substantial global rises in all major markets, led by Europe where it is beginning to look like another round of quantitative easing might be on the table and, in the US, the Fed hinted about a July rate cut, with more to follow.

SINO/US Trade negotiations back on track

Positive news around the China and US trade negotiations further brightened the outlook; G20 talks are back on track, and President Trump has seen fit to reverse his ban on selling technology to the Chinese technology giant, Huawei.

Emerging markets, led by China and Korea, but with the exception of Romania, also rose during June, buoyed by the brighter trade negation outlook.

Weakening European inflation expectations leads to speculation about Quantitative Easing

European Equity Markets also rode the wave higher during June following speculation that another round of Quantitative Easing may be the only play left for the European Central Bank.  The stance was mainly stimulated by a speech from the outgoing President of the ECB, Mario Draghi, who said that to boost the EU economy, the ECB stands ready to ease its policy stance further.

Together with the increasing likelihood that Boris Johnson will be the next UK Prime Minister, and possibly the only candidate able to deliver Brexit, this led to UK stocks also rising and added further impetus to emerging market rises.  The real impact of the UK leadership elections will be felt later this month when the results are announced on Tuesday 23rd July.