Pre summer-holiday investment check

As we head towards the summer holidays, it’s worth checking on some of the expectations we had at the start of the year.

The road to Brexit

Just over a year on from the referendum result, the UK’s future relationship with the EU is about as unclear as it was then. On Wednesday, the EU’s chief negotiator Michel Barnier responded to Boris Johnsons suggestion to “go whistle” by telling him that “I’m not hearing any whistling, just a clock ticking,” Let’s take stock; how did we get here?

Q2 corporate earnings outlook

The quarterly earnings season unofficially kicks off in the US this week and, together with companies in Europe and Japan, stock market quoted companies report their results over the next four weeks. Q2 is looking fairly pivotal for equity investors, who are awaiting validation that their positive stance on equities and the subsequent rally – which has taken markets to new record highs – is justified even if economic growth rates have moderated.

Germany: Don’t mention the …er… trade surplus 

Germany’s annual trade surplus stands at ~ $300bn (~8% of GDP) and is greater even than China’s ongoing surplus (of $200bn) – and with that continues to be the world export Weltmeister. This clearly illustrates that, while Germany is doing something right from a trade perspective, it may be saving too much of its income relative to investment and consumption. Aside from the obvious economic points, the trade imbalance is causing considerable political angst within the G20.


Please click here to read the full Tatton commentary.