Market review from August

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Martin Signer activities: Managing Director, IR, test, Testing, Testing, Participant, Partner, Media partner, Media partner, Event manager, Events, Tester, Event listing, Tester, IR, IR, Test, Managing Director, IR, IR, IR, IR Partner

Sep 16, 2019

According to Rothshild & Co, until the end of August, global financial markets posted mixed performance as equities traded in a volatile environment driven notably by ongoing Sino American trade tensions (Trump’s plans to raise tariffs on Chinese imports and Chinese authorities response letting the yuan breaking through the previously defended floor of 7 yuan / US Dollar to unseen low since 2008) as well as new episodes in the Brexit saga, while fixed income markets surged on lower US interest rates.

Hedge fund strategies posted mixed performances during the month: the HFRI Fund of Funds Composite was down -0.73%, the HFRX Global HF was up 0.38%, the HFRU Hedge Fund Composite Index was down -0.29%.

Global equity markets posted negative performance (MSCI World Net TR $ Index down -2% and MSCI Europe Net TR € Index -1.4%) through a volatile month, led by the US (S&P 500 Net TR $ Index was down -1.7%), the UK (FTSE 100 Net Tax £ Index was down -4.1%) and Japan (TOPIX 1000 TR ¥ Index was down -3.3%). In the US, losses were led by Biotech, Energy and small cap sensitive exposures; from a regional standpoint, declines were led by the UK as well as Hong Kong (Hang Seng Net TR $ index was down -8.9%) driven by uncertainty around Brexit and social unrest in Hong Kong. Fixed income markets surged on lower US interest rates as the US Fed lowered rates at the end of July. Germany issued 30Y government bonds at negative yield while the supply of negative yielding government bonds increased to $15 Trillion globally. In FX, the USD gained against most commodity currencies as several foreign central banks lowering rates in their respective countries. However the US$ fell against the JPY (by -2.3%). For commodities, performances were mixed with declines in Energy (led by Oil) offset by gains in Metals (led by Gold, Platinum & Silver) while Agricultural declines were led by Corn, Hogs, Sugar and Wheat on tariff considerations.