Weekly Market Recap
Week in review
- 19/08 – CN – Foreign Direct Investment
- 21/08 – U.S. – Existing Home Sales
- 22/08 – U.S. – FOMC Minutes
- 23/08 – U.S. – New Home Sales
Thought of the week
Global stocks fell as weak data increased fears over global growth, and bond markets signaled that chances of a recession were mounting. Underscoring rising concerns, the yields of U.S. and UK 10-year government bond yields dipped below those of shorter maturity debt for the first time since the financial crisis – an inverted yield curve has historically been a harbinger of a recession. However, investors should note that quantitative easing policies adopted by global central banks have distorted this barometer of economic health, and it is important to combine this signal with other indicators. Corporate investments have been under pressure amid rising policy uncertainties around trade, while U.S. household consumption remains supported by low unemployment and a strong balance sheet. In this current environment, investors can look to add equities at more reasonable valuations while fixed income’s low volatility and income potential can provide a balanced return.
Chart of the week
U.S. Yield Curve Inversion and Recessions
Difference between 10-year and 2-year U.S. Treasuries
JPMorgan China Income Fund
To provide investors with income and long-term capital growth by investing at least 70% of its non-cash assets in (a) equity securities of companies which are based in, listed on any stock exchange of, or operate principally in the PRC and that the Investment Manager expects to pay dividends and (b) Chinese debt securities issued and/or distributed in or outside the PRC.