Markets

Monthly markets review - August 2016

An overview of events in August 2016 when developed markets were largely flat and emerging markets made gains.

06 Sep 2016

Investment Communications Team

Investment Communications Team

30 Minutes
Unstructured Learning Time

CPD Accredited
  • The MSCI World index was little changed in August (in US dollar terms) and was outpaced by emerging market equities which were supported by investors’ focus on higher yielding assets.
  • US equities were little changed as expectations grew that the Federal Reserve would raise rates again this year.
  • Eurozone equities advanced, supported by some strong quarterly earnings. Cyclical sectors such as materials, financials and industrials were the top gainers.
  • UK equities performed well as the Bank of England launched a series of monetary easing measures in the wake of economic uncertainty following the Brexit vote.
  • Japanese equities gained slightly. The government released details of a fiscal spending package designed to run alongside the Bank of Japan’s continuing aggressive monetary policy easing.
  • Emerging markets extended their recent upward trend. Several markets continued to benefit from comparatively high real yields, including Russia, Brazil and Colombia.
  • In fixed income, the easing measures announced by the Bank of England were supportive for gilts, while sterling corporate bonds made further gains.