Global growth is becoming increasingly less synchronized, with the Eurozone, Japan and UK showing an ongoing moderation in growth, whilst the US remains robust.
It seems that China does not wish to compromise with the U.S., but neither does it wish to retaliate strongly to the $200BB of additional tariffs. Since it does not wish to “lose face” in giving this light response, it is putting a positive spin on its actions by saying it wishes to be the leader of the free trade movement.
John Vail, Chief Global Strategist for Nikko Asset Management, contributes a regular column to Forbes.com
The Japanese equity market was mixed in June, with the TOPIX (w/dividends) falling 0.76% on-month and the Nikkei 225 (w/dividends) climbing 0.65%.
Our London-based Emerging Market fixed income portfolio manager provides an update for Latin American markets in the midst of a hectic election schedule. Despite the risks, pro-market reforms should still progress to varying degrees across the region.
Uncertainty surrounding Trump policy has reached new highs with global trade wars back on. Steel and aluminium tariff exemptions have been allowed to lapse for Canada, Mexico and Europe, and USD 50 billion in new technology-focused tariffs against China will be detailed by mid-June and imposed shortly thereafter.
The MSCI AC Asia ex Japan (AxJ) Index closed -1.3% in USD terms as markets turned more risk averse amidst macro uncertainties, trade tensions and higher oil prices.
In May, US Treasury (UST) yields ended lower. A solid US jobs report supported the bearish bias in UST yields that prevailed.
The ECB recently celebrated its 20-year anniversary and instead of a birthday cake, DB research released a compelling chart about how different asset classes have performed over this time period.
Despite uninspiring global equity performance in the last three months, at least for USD-based investors, Nikko AM’s Global Investment Committee continues to be positive on global equities on a one-year view, particularly those in Japan, Europe and the Asia Pacific, but remain unenthusiastic on global bonds.
Global growth is becoming increasingly less synchronized, with the Eurozone, Japan and UK showing some moderation in growth, whilst the US remains relatively robust.