Weekly Market Overview – Nervous equity markets continue to slide

Concerns over US Government debt levels, softening global macro data and a potentially hawkish Federal Reserve once again lead to negative equity returns after a significant sell-off in the previous 2 weeks. All global equity markets are now in negative territory for the year in both local and Sterling terms. Last week US markets were down -2.6% in Sterling, however this was a relatively benign drop compared to other markets. UK equities were down -4.7%, Emerging Market equities -4.6% and European equities -4.4%. Meanwhile Japanese markets fared relatively well, down -3.1%. Global yields moved only modestly downwards after their recent spike, with the US 10Y Treasury yield finishing the week unchanged at 2.84%, although the UK 10Y Gilt yield fell by 2bps to 1.55%. Sterling was negative against most currencies, falling -2.1% vs USD, -0.4% vs EUR and -3.2% vs JPY. In USD terms Gold fell -1.3% and Oil fell -9.5% after Iran announced plans to boost production and US crude output hit record highs.

Read our full Market Update Week 6