June 2019

• Global markets rebounded strongly in June as major central banks signalled increased willingness to support growth through monetary easing.
• The Federal Reserve shifted decisively toward a more accommodative policy stance, raising expectations for future interest rate cuts.
• Equity markets globally recovered from May’s losses as trade tensions temporarily eased and investor confidence improved.
• Bond yields declined sharply to multi-year lows as markets priced in easier monetary policy.
• Emerging markets benefited from improving risk appetite and weaker dollar conditions.
• Gold prices rallied strongly as falling yields increased demand for safe-haven assets.

Asia (ex. Japan)

Asian markets outside Japan recovered strongly during June as investors responded positively to signals of monetary support from major central banks and a temporary easing in U.S.-China trade tensions. Chinese authorities continued implementing targeted stimulus measures to stabilise domestic growth and manufacturing activity.

Technology-heavy markets such as Taiwan and South Korea rebounded alongside improving semiconductor sentiment, while India advanced as lower inflation and expectations for further monetary easing supported domestic demand conditions.

Europe

European equities rallied during June as the European Central Bank signalled greater readiness to introduce additional stimulus if economic conditions failed to improve. Falling bond yields and improving global sentiment supported cyclical and defensive sectors alike.

Economic data across the eurozone remained relatively soft, particularly within manufacturing, though investor optimism improved due to supportive monetary policy expectations and reduced trade-related fears.

United States

U.S. equities rebounded sharply during June as the Federal Reserve adopted a more dovish tone and markets increasingly anticipated interest rate cuts later in the year. Technology and growth sectors led gains as Treasury yields fell significantly.

Employment conditions remained supportive overall, though softer business investment and manufacturing data reinforced expectations for monetary easing. Investor confidence improved substantially following May’s volatility.

United Kingdom

UK equities advanced during June as improving global market sentiment offset continued domestic political uncertainty surrounding Brexit and the Conservative leadership contest.

Sterling remained volatile due to political developments, while the Bank of England maintained a cautious monetary policy stance amid slowing business investment and moderate economic growth.

Japan

Japanese equities recovered strongly during June as improving global sentiment and expectations for easier monetary policy supported exporters and cyclical sectors.

The Bank of Japan maintained highly accommodative policies and continued signalling readiness to provide additional support if necessary. A relatively stable yen also helped improve investor confidence.

Emerging Markets

Emerging markets performed strongly during June as falling U.S. bond yields, weaker dollar conditions and improved global risk appetite encouraged investor inflows.

Asian economies led gains due to recovering technology sentiment and Chinese stimulus measures, while commodity exporters benefited from improving demand expectations and stable financial conditions.

Commodities

Commodity prices delivered mixed performance during June. Oil prices stabilised and recovered modestly following May’s sharp declines as geopolitical tensions in the Middle East supported energy markets.

Gold prices surged to multi-year highs as falling bond yields and expectations for central bank easing boosted safe-haven demand. Industrial metals also stabilised as trade tensions temporarily eased.