Published: 26 July 2019
Politics continued to dominate investor sentiment around the globe, with markets influenced particularly by developments in ongoing trade tensions between the US and China.
The backdrop was a slowing global economy. The economic expansion that has broadly persisted since the 2008 financial crisis looks ever-longer in the tooth, but key central banks continue to try and prolong it through their words and actions on monetary policy.
Buoyed by this approach from central banks, in the first half of 2019 markets broadly rebounded from a major wobble at the end of 2018.
Diversification remains important in all economic and market conditions. A well-diversified portfolio can help smooth out the ups and downs that inevitably come with investing. It can help you to benefit from the opportunities that are always out there and to manage your risks of loss.
Try not to get too distracted by short-term ups and downs in financial markets. Investing is for the longer-term. So it’s the developing longer-term sentiment you should also aim to focus on when making decisions about how best to manage your portfolio.
This is provided for general information only and takes no account of personal circumstances. It is not a recommendation to buy or sell. It is provided solely to support you in making your own investment decisions. If you have any doubts as to their suitability you should seek expert advice. Alliance Trust Savings does not give financial or investment advice.
Please be aware that the value of investments can fall as well as rise so you could get back less than you invest. Past performance is not a guide to future performance.
1 CNN Business, Stocks fell just about everywhere in 2018, 31 December 2018
2 Office for National Statistics, GDP Monthly estimate, May 2019 (released 10 July 2019)
3 OECD, Economic Outlook May 2019
4 Financial Times, G20 meets as trade rifts heighten risks to global economy, 27 June 2019
5 Financial Times, Fed chair cements case for cut in interest rates, 10 July 2019
6 Financial Times, ECB ‘ready and prepared’ to ease policy amid rising uncertainty, 11 July 2019
7 The Guardian, Bank of England warns of interest rate rises over next 3 years, 2 May 2019
8 International Monetary Fund, World Economic Outlook, Growth Slowdown, Precarious Recovery, Chapter one, April 2019 (Table 1.1, page 8)
9 The Independent, UK economy likely to have contracted in second quarter, 3 July 2019
10 Trading Economics, UK Inflation Rate
11 The Guardian, Trump escalates trade war with China with plan to raise tariffs, 6 May 2019
12 S&P 500 notches record close on G20 trade relief, 1 July 2019
13 FTSE 100 closed at 6728 on 31 December 2018 and 7425 on 28 June 2019. S&P 500 closed at 2507 on 31 December 2018 and 2914 on 28 June 2019
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