The start of 2020 was reminiscent of much of 2019. Bond yields drifted lower, consistent with the slowdown in global growth, manufacturing, and trade in 2019 and persistently low inflation. Despite the effect on corporate earnings – lacklustre growth and falling forecasts – and already-high valuations, global equity markets pushed even higher.

We share the latest trends in the market, including:

• The impact on supply and demand from containment measures adopted across much of the world will inevitably impact the rate of global economic growth in 2020 and, possibly, beyond.
• The latest forecasts suggest the global economy, including most major advanced economies, will enter a deep recession in the first half of 2020. Indeed, growth is almost certainly already negative in many economies.
• Manufacturing PMIs fell less, but likely do not reflect the full extent of the contraction and may have been supported by a technicality of increased supplier delivery times, which in more normal circumstances suggest increased demand.
• Forecasts point to a recovery once social distancing measures are relaxed, and monetary and fiscal stimulus combine with resumption in discretionary spending and production.

read the full capital markets update here

Join our mailing list