Good day and congratulations to Tokyo taking gold and going on to win the 2020 Olympics.There seemed to be a lot of focus on data last week as the US FED kept relatively quiet on any predictions ahead of their meeting next week. In addition, with a relative delay in any intervention with Syria, focus seemed to moveaway from Syria from a market perspectivefor the time being, although oil prices remained high given recent tensions. This allowed for some comfort to (most) investors and saw the US S&P end the week on a positive note up just over 1%. Equally, the UK FTSE also ended up just over 1%, and the Hong Kong Hang Seng saw gains slightly over 2% at week’s end.
Most of the movements followed China’s manufacturing numbers as they beat expectations, and following on from July with yet another consecutive month of better than expected trade numbers, China seems to be gaining some traction on the manufacturing and production side. It appears there is a slight turn in global manufacturing too, with the UK, Eurozone, and US also putting up slightly better than expected manufacturing data in recent months. Such global trend shows that these regions, and markets, are finding firmer ground in this still somewhat fragile economy. But what exactly has this meant? It’s certainly helped boost material and commodity demands, and although commodities remain subdued on a 2 year time frame, they have started to climb in recent months from their lows earlier this year. It will no doubt take some more time for these sectors to fully recover, but if they can hold their current trends, it should allow them to bounce back with some strength and resilience.
Global equities continue to benefit from increasing rises in markets and although the US FED meeting next week could provide some hesitation, it’s unlikely they will announce anything to derail the positive trends seen so far this year. As we’ve said before, it’s difficult to predict what exactly they’ll announce, but when they do decide to announce a reduction in stimulus we would expect it to be small enough, or insignificant enough, to allow for the current trends to continue. At least that’s what they’re (and we’re) hoping for! Despite this, there’s no guarantee they’ll achieve this without any interruptions along the way, so with that in mind, we’ll continue to encourage you to maintain a balanced and diversified approach and hold a mixture of asset classes to help spread out any risk.
For Austen Morris Associates’ investors – talk with your advisor about any repositioning to take advantage of markets at this time. For more information about Austen Morris Associates please visit our website.
Austen Morris Associates Wealth Management & Investment Team
www.austenmorris.com
