August 2018

• Global markets experienced renewed volatility in August 2018 due to emerging market currency crises and ongoing trade tensions.
• Turkey and Argentina faced severe financial pressures, increasing investor caution toward emerging markets.
• U.S. equities continued outperforming most global peers due to strong economic growth.
• European markets were pressured by banking exposure to emerging markets.
• Oil prices remained relatively stable despite broader volatility.
• Safe-haven demand increased modestly during periods of market stress.

Asia (ex. Japan)

Asian equities outside Japan experienced increased volatility during August as emerging market concerns and trade tensions weighed on sentiment. Chinese equities remained under pressure due to slowing growth and tariff concerns.

Technology exporters remained relatively resilient overall, though investor caution increased across the region.

Europe

European equities weakened during August as concerns over Turkey’s financial crisis and exposure among European banks unsettled markets.

Economic growth remained moderate, though investors became more cautious regarding global financial stability and trade conditions.

United States

U.S. equities continued outperforming during August as strong corporate earnings and economic growth supported investor confidence.

Technology sectors remained key drivers of gains, while the Federal Reserve maintained gradual tightening expectations.

United Kingdom

UK equities were relatively stable during August as commodity sectors remained supportive despite broader global volatility.

Brexit uncertainty continued affecting sterling and domestic-focused sectors, while the Bank of England raised interest rates modestly.

Japan

Japanese equities experienced modest volatility during August as trade tensions and emerging market concerns affected exporters.

Supportive monetary policy and relatively stable domestic conditions helped limit broader downside pressure.

Emerging Markets

Emerging markets experienced significant volatility during August due to crises in Turkey and Argentina alongside continued dollar strength.

Countries with stronger external balances performed relatively better, while vulnerable economies faced heavy currency and equity declines.

Commodities

Commodity prices were relatively stable during August despite broader financial market volatility. Oil prices remained supported by supply constraints.

Industrial metals remained weak due to Chinese growth concerns and trade tensions, while gold prices stabilised modestly.