Politics, trade wars and mixed data took up headlines last week.

Away from politics in the US and Europe, Hong Kong’s pro-democracy party won 85% of seats at the local elections, more than trebling the number of seats that they won in 2015. Turnout was also significantly higher at 71%, up from 47% in 2015. According to sources in Hong Kong, 17 councils out of a total of 18 will now be controlled by pro-democracy councillors. Local elections are normally of little interest, but these polls were the first time people were able to express their opinion over how the crisis in Hong Kong has been handled.

Several days later, and never one to be out of the limelight for long, Trump defied China when he signed the Hong Kong Rights & Democracy Act into law; the agreement effectively supports demonstrators and was condemned by China’s foreign ministry. In recent weeks, the US-China trade deal was on target to reach phase-1. However, Trump’s latest move will likely strain relations, making it difficult to finalise a trade truce. Regardless, the US equity market hit another all-time high.

Data in China last week was broadly positive, providing a fillip to global equity markets; one pocket of disappointment was industrial profits, which fell to 9.9% on an annualised basis, the worst contraction since 2011. Retail sales in both Japan and the US showed signs of weakness; in Japan sales fell c.7% year-on-year following a VAT hike. European data bucked the trend; manufacturing showed signs of stabilisation and French consumer confidence was better than expected at 106.