Economics

Monthly markets review - August 2017

A review of markets in August 2017 when economic data was largely positive and emerging market equities outperformed.

6 September 2017

Investment Communications Team

Investment Communications Team

  • The MSCI World index eked out a positive return in August. Escalating US-North Korea tensions and Hurricane Harvey’s Texas landfall weighed on sentiment but economic data remained largely positive.
  • US equities were supported by generally positive economic data, including an upward revision to second quarter GDP growth. However, the energy sector performed poorly in the wake of Hurricane Harvey.
  • Eurozone equities declined and the stronger euro was a headwind. The euro’s gains came as domestic economic indicators remained robust.
  • UK shares gained with some less economically-sensitive sectors performing well while the mining sector was lifted by a stronger backdrop for industrial metals prices.
  • Japanese equities posted only a small decline as a positive corporate earnings season helped offset worries about North Korea and a stronger yen.
  • Emerging market equities outperformed developed markets. Higher commodity prices supported stockmarkets in Latin America.
  • North Korea-related concerns contributed to government bond yields declining. Speeches from central bank chiefs Janet Yellen and Mario Draghi at the Jackson Hole symposium were notable for their lack of hawkish sentiment.

Important Information: The views and opinions contained herein are those of the author(s) on this page, and may not necessarily represent views expressed or reflected in other Schroders communications, strategies or funds. This material is intended to be for information purposes only and is not intended as promotional material in any respect. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. It is not intended to provide and should not be relied on for accounting, legal or tax advice, or investment recommendations. Reliance should not be placed on the views and information in this document when taking individual investment and/or strategic decisions. Past performance is not a reliable indicator of future results. The value of an investment can go down as well as up and is not guaranteed. All investments involve risks including the risk of possible loss of principal. Information herein is believed to be reliable but Schroders does not warrant its completeness or accuracy. Some information quoted was obtained from external sources we consider to be reliable. No responsibility can be accepted for errors of fact obtained from third parties, and this data may change with market conditions. This does not exclude any duty or liability that Schroders has to its customers under any regulatory system. Regions/ sectors shown for illustrative purposes only and should not be viewed as a recommendation to buy/sell. The opinions in this material include some forecasted views. We believe we are basing our expectations and beliefs on reasonable assumptions within the bounds of what we currently know. However, there is no guarantee than any forecasts or opinions will be realised. These views and opinions may change.  To the extent that you are in North America, this content is issued by Schroder Investment Management North America Inc., an indirect wholly owned subsidiary of Schroders plc and SEC registered adviser providing asset management products and services to clients in the US and Canada. For all other users, this content is issued by Schroder Investment Management Limited, 31 Gresham Street, London, EC2V 7QA. Registered No. 1893220 England. Authorised and regulated by the Financial Conduct Authority.