- In what was described as a landmark moment, MSCI added China “A” shares into its Emerging Market Index, after rejecting them in each of the last three years. The index provider said it would add 222 China “A” large cap stocks from next year. This will represent 0.73% of the index.
- Brent Crude oil fell below $45 for the first time this year, as investors become increasingly concerned with OPECs ability to meaningfully cut production.
- As part of Brexit negotiations, the ECB will look to increase their oversight of the euro clearing business, which is currently overseen by the BOE. This would be an unwelcome event for the UK banking industry, with an EY report suggesting if this business does move out of London as many as 83,000 jobs could be affected.
- Argentina has launched a 100-year bond, with investors more upbeat over the economy that defaulted on $100bn of debt in 2001. The $2.75bn century bond was issued at a slight discount and with a coupon of 7.13%. Argentina is currently rated “B” by the rating agency S&P, with a “stable” outlook.
- On Tuesday 27 we will see the release of US Consumer confidence, as measured by the University of Michigan’s sentiment index. The expectations are that consumer confidence is to fall to a value of 115 from the previous month’s value of 117.9, as US consumers continue to be less than enthused with the lack of policy action.
- On Friday 30 June we will have the release of UK Q1 GDP, with expectations of an increase in output of 0.2%.
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
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.