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Monthly report, July 2024

Updated: Jul 9

In the latest edition of our monthly report:


The bond market has lost its flair

  • In the past, an infallible flair for predicting recessions;

  • Expectations for rate cuts in 2024; and

  • Long duration bond in negative territory for a 3rd year.


Assessment of the economic situation

A still-solid US economy raises fears that the Fed will once again postpone the start of its rate-cutting cycle. The ECB began its own in June, while the SNB is cutting its key rates for a second consecutive time.

  • Economic growth revised upwards for 2024;

  • Copper "calms” things down”; and

  • The "hard landing" camp shrinks drastically.

 

Financial markets during the month

French political tensions are weighing heavily on the CAC 40 and, to a lesser extent, on European indices. The US market is outperforming, buoyed once again by investor enthusiasm for AI.

  • The CAC 40 plunges, the Nasdaq continues to rise;

  • Risk premium on French debt up sharply; and

  • The euro retreats in the wake of French assets.

 

Comments on investment decisions

Politics is on the menu for French equities and bonds, putting pressure on the single currency. Japanese equities emerge from their 3-month consolidation, while the AI craze continues. The long end of the yield curve remains volatile, and gold consolidates at high levels, despite a slightly rising dollar.

  • Equities;

  • Bonds;

  • Precious metals, listed real estate (REIT); and

  • Currencies.

 

Performance summary

  • Equity performances, and

  • Performance of bonds, currencies and commodities.

 






Disclaimer

This document has been prepared using sources believed to be reliable but should not be assumed to be accurate or complete. The statements and opinions it incorporates were formed after careful consideration and may be subject to change without notice. The author and distributors of this document expressly disclaim any and all liability for inaccuracies it may contain and shall not be held liable for any damage that may result from any use of the information presented herein. Past performance is not indicative of future results. Values of an investment may fall as well as rise. This document is intended for information purposes only and should not be construed as a recommendation, an offer or the solicitation of an offer to buy or sell any investment products or services. The use of any information contained in this document shall be at the sole discretion and risk of the user. Prior to making any investment or financial decisions, an investor should seek individualized advice from his/her financial, legal and tax advisors that consider all of the particular facts and circumstances of an investor's own situation.


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