Weekly Digest – INVESTEC

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Last week, strong global equity markets and a strong sterling were features, as the receding earnings season was met with mixed economic data, together with positive signs on the progress of US/China trade talks and a perceived pushing-out of Brexit risks. These factors encouraged risk appetite, driving global equities up by 2.8% in dollar terms.

The UK led the pack in developed markets, rising by 4% in dollars. A 2% rise in £ vs $ (from just over $1.30 to just under $1.33) reduced the strength for UK reporting portfolios, so Global Equities and UK Equities were up by 0.8% and 1.9% in sterling terms. Fixed income markets were a touch firmer, with US ten-year yields edging below 2.6%, whilst UK 10 year yields ticked upwards, to 1.21%.  UK Parliament rejected PM May’s Brexit deal for a second time, rejected a ‘No Deal’ Brexit and voted for a three-month extension of the previous Brexit deadline to 30 June. Europe’s response has yet to be formulated.

It is another busy week of corporate news, especially within the retail sector. Companies high on our radar reporting earnings releases include Kingfisher on Wednesday and Next, Nike, SMCP and Ted Baker on Thursday.