Market volatility continued for the week ending 23^rd August 2019, with global equities down -1.6% in GBP terms as measured by MSCI ACWI – this was primarily driven by ongoing concerns regarding the US economy as well as a weakening Dollar. Global bonds fell -0.1% over the week, while Sterling bonds fell -0.3%. Sterling rose against all major currencies, having weakened significantly for the year to date.

While England simultaneously basked in a sweltering bank holiday weekend and victory over Australia in the cricket & Ireland in the rugby; the leaders of the major western democracies gathered in Biarritz for the annual G7 summit. In spite of some rather superficial gestures regarding advancing the Iranian nuclear talks and the establishment of a fund to combat Amazonian forest fires, the summit was broadly as dysfunctional as it has been over the Trump era. President Macron attempted a charm offensive with Mr Trump, hoping to appear statesmanlike. Prime Minister Johnson spent the weekend portraying the UK as open, outward looking and ready for new international trade deals in a post-Brexit world.

We can expect market volatility to continue into this week as the London markets re-open (with the air-conditioning up full blast no doubt). Worries over the US-China trade war persist, Italian political drama drags on and the depth of the economic slowdown in Germany is a serious cause for concern. The upside for equity markets is now potentially more limited than that of England’s prospects in The Ashes.