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INVESTMENT OUTLOOK

Breaking the bad news cycle

Read about global markets and trends in this monthly Investment Outlook.

Published on 06 Jul 20231 minute read

This monthly commentary gives a roundup of global markets and trends.

In this edition:

After a poor performance in 2022,  share prices have rallied this year on easing recession concerns. There are several reasons why stocks could defy the bad news associated with recession:

  • Momentum - in early June the US S&P 500 was up 20% from its low point in October 2022, marking a new bull market. The average bull market lasts 5.5 years1
  • Covid-era policies provide support – it’s estimated that households have plenty of unspent funds left over from Covid. In developed economies, these range from 6% of GDP in the US, 7% in the Eurozone, 8% in the UK and 9% in Japan2
  • Dollar depreciation – we have a negative outlook for the US dollar – a weaker US dollar, when accompanied by global growth, is usually positive for financial assets

Sources:

1 Refinitiv/Evelyn Partners

2 Citi, How Much Firepower Do Consumers Have Left in DM Economies?, 5 May 2023

Important information

The value of an investment may go down as well as up and you may get back less than you originally invested.

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