Blog

12th June 2017

Copia Monday Espresso

 

 

  • The voting in the UK General election resulted in a hung Parliament, with no party reaching a majority share of the votes. Early on Friday afternoon Theresa May declared she intended to stay on as Prime Minister and will seek a minority government with formal backing of Northern Ireland’s right-wing Democratic Unionist Party.
  • After its latest meeting, the European Central Bank left rates and policies unchanged, whilst revising their inflation expectation for 2019 downwards to 1.6%.
  • There was a sharp sell-off in oil after the latest data showed an unexpected rise in US inventories. Following this surprise, Brent Crude oil fell by 4%.
  • The Japanese Government unexpectedly revised GDP downwards, from a previous annualised figure of 2.4% down to an annualised value of 1%. This downward revision mostly came from a change in private inventory investment.

 

 

 

 

 

  • On Tuesday 13 June we will see the release of UK Core CPI YoY, with the market expecting this to come in at 2.3%.
  • On Wednesday 14 June we will have the Federal Open Market Committee’s decision on the US Federal Funds Target rate. The futures market is pricing in a probability of 98% that we will see an increase in the benchmark rate to 1.25%.

A score of -1.0 indicates an extremely poor economic outlook, which is accompanied by a high probability of negative returns in risky asset classes like equities. The Risk Barometer tilts our portfolios away from equities during such periods.

A score of 0 indicates a neutral economic outlook with almost equal probability of positive and negative returns in risky asset classes like equities. The Risk Barometer maintains a balance between equities and other asset classes during such periods.

A score of +1.0 indicates an extremely positive economic outlook, which is accompanied by a high probability of positive returns in risky asset classes like equities. The Risk Barometer tilts our portfolios towards equities during such periods.

*as at latest realignment 22/05/17

Notice:

The performance of each asset class is represented by certain Exchange Traded Funds available to UK investors and expressed in GBP terms selected by Copia Capital Management to represent that asset class, as reported at previous Thursday 4:30pm UK close. Reference to a particular asset class does not represent a recommendation to seek exposure to that asset class. This information is included for comparison purposes for the period stated, but is not an indicator of potential maximum loss for other periods or in the future.

Risk Barometer

0

as at latest realignment

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    Copia Capital Management

    Fleet House, 8-12 New Bridge Street, EC4V 6AL

    Copia Capital Management is a trading name of Novia Financial Plc. Novia Financial Plc is a limited company registered in England & Wales. Register Number: 06467886. Registered office: Cambridge House, Henry St, Bath, Somerset BA1 1JS. Novia Financial Plc is authorised and regulated by the Financial Conduct Authority. Register Number: 481600.

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