Along with the weather, markets have been distinctly perkier in the second quarter. The S&P 500 may have had its ups and downs, but overall has seen a steady climb from its low in March.
Yet on the surface, many of the problems remain. Trump’s trade war is far from resolved. While it has been more rhetoric than action to date, it still looms over government and corporate spending plans. There remains the threat that it will escalate, hitting economically signifi cant sectors such as technology.
At the same time, Donald Trump continues to take a casual approach to the structures that have supported liberal capitalism for decades, which is unsettling for fi nancial markets.
There is better news from the global economy. It appears that the economic weakness at the start of the year may just have been a weather-related blip and, at the time of writing, indicators were improving.
However, there is little doubt that there is less absolute value in markets. The monetary policy environment is changing and removing a key support. In this month’s issue, we look at where investors can still fi nd value in this type of environment.
Baillie Gifford’s Torcail Stewart discusses how he uncovers value within the otherwise expensive corporate bond markets; Fidelity’s Alex Wright discusses the merits in a contrarian approach; while Square Mile discusses whether absolute return funds may be the answer. Investec’s Alistair Mundy suggests that value investing can occasionally leave you on the naughty step.
We also tackle some of the big issues: Schroders takes on Brexit, Janus Henderson discusses the key risks in the global economy, while Aviva Investors looks at the equally big problem of how not to run out of money in retirement.
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