The U.K. Stockmarket
- Pressure increased on Prime Minister Theresa May this week as EU leaders rejected her Chequers plan at a summit in Salzburg. They made it clear that trade and the Irish border issue need further negotiation if a hard Brexit is to be avoided.
- On Friday the PM declared that talks were at an impasse – the Pound declined sharply and the stock market rallied.
- Our Breadth Indicator stayed negative this week and our Momentum indicator ticked lower again.
The U.S. Stock market
- On Monday President Trump announced that another $200 billion worth of Chinese goods would be subject to a 10% tariff. This had little negative impact on the market which rose for the rest of the week indicating that 10% may have been less than many investors feared.
- Another announcement taken positively by investors was the declaration by Chinese officials that they would not allow the country’s currency to devalue further.
- A further boost came on Thursday when data showed that jobless claims had fallen to its lowest level in fifty years.
- Our Breadth indicator turned positive (from neutral) and our Momentum indicator ticked up again.
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This communication is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell investments.’