St. James's Place News
Markets enjoy a relief rally following EU summit
Developed markets enjoyed a relief rally towards the end of last week, buoyed by an agreement reached at the latest EU summit, which allowed equities to end a disappointing second quarter on a positive note. However, investors endured another rollercoaster ride in the run-up to the summit as the bulls and bears fought for ascendency driven by speculation that a deal would be struck to help two more of the eurozone’s ailing members, Spain and Italy.
The improved sentiment enabled the London stock market to overcome the latest scandal to hit the maligned banking sector which involved the manipulation of the benchmark lending rate, LIBOR.
Also in this week's bulletin...
- The 19th EU summit (in the past 18 months) saw a number of proposals agreed, which included allowing the European Stability Mechanism to intervene and aid banks directly, specifically Spain’s.
- In the UK, there is increasing evidence that the slowdown in the economy has been greater than anticipated. Official figures from the ONS showed that the economy shrank by 0.7% in the six months to March – slightly worse than originally estimated.
- We hear from Nigel Waller of Oldfield Partners who explains that, whilst there are undoubtedly fundamental challenges facing the eurozone, at a corporate level many individual companies continue to prosper.
View this week's Market Bulletin (PDF), which contains thoughts and opinions of St. James’s Place and our range of investment managers on the key issues affecting investors.
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