Economics
- The US and the EU are moving closer to reaching an agreement on their trade dispute.
- Inflation in the UK remains too high, allowing the Bank of England to act only carefully.
- Tariffs are beginning to be reflected in US consumer prices, preventing the Fed from cutting interest rates further.
Equities
- US stocks hit a new all-time high thanks to share buybacks, purchases by systematic investors, trade deals, and solid economic data.
- US reporting season gets off to a largely positive start. Europe is likely to benefit from potential trade deal.
- Weaker seasonality, negative tariff surprises, and increased positioning could increase volatility.
Bonds
- While the Fed continues to face inflation risks from tariffs, political pressure on it is mounting.
- The risk of valuation adjustments has risen recently in both the high-yield and investment-grade segments.
- US President Donald Trump's trade and tariff policy remains the key issue in emerging markets.
Alternative investments / commodities
- OPEC+ continues to turn up the oil tap. Beyond geopolitics, there are few reasons for optimism.
- Structural drivers for gold remain intact, but short-term drivers are lacking. Strong price increases are likely to dampen investor demand.
- Copper is still benefiting from possible US tariffs. If the tariffs are imposed, prices are likely to fall again both here and in the US.
Currencies
- US dollar with its worst first half-year since 1973.
- There are numerous reasons for the dollar's weakness, and these remain in place for the time being.
- The result of the upper house elections and the trade agreement with the US are moving the Japanese yen.
