In order to ensure we provide our clients with the highest quality and breadth of service, we have a tried and tested team of associated professionals with specific fields of expertise.
We will be there for you when you need us with day-to-day issues and your financial administration will be managed proactively by your Client Manager
Stock market have remained buoyant despite some signs of economic weakness in the US and other regions
Signs of stress in the US
Although America's economy continues to expand against a backdrop of high interest rates, there are some areas of weakness. Despite the addition of 272,000 new jobs in May, the unemployment rate rose slightly to 4% in May. Meanwhile, consumer spending has showed signs of slowing. with retail sales increasing by only 0.1 over the month.
UK rates on hold for now
The Bank of England kept interest rates steady at 5.25%, a 16year high, despite inflation falling to its 2% target. Although overall price rises have slowed, services inflation - a key metric followed by the Bank - was higher than expected at 5.7%. There was also an unexpected increase in the unemployment rate to 4.4% for the three months to April.
Continental uncertainty
European share prices fell after French President Emmanuel Macron called an election following a surge in support for the far-right in the 2024 European Parliament election. Meanwhile, the European Central Bank (ECB) reduced interest rates for the first time in nearly five years, diverging from the Fed and the Bank of England as inflation fades.
Equities climb higher
Stock markets around the world have continued to rise, including in the US due to renewed excitement over artificial intelligence and fading inflation, raising hopes for rate cuts. On a relative basis, growth is outperforming value, large cap is outperforming small cap, and developed markets are outperforming emerging markets.
Rate cuts are on the way
Interest rates have already started to fall in the euro areas, and some countries, including Canada, Switzerland and Sweden. Cuts remain likely in the US and UK although have been delayed until later in the year. Government bonds usually respond positively to lower rates and we expect yields to fall (meaning prices will rise).
We [Omnis] remain cautiously positioned
We have an overweight allocation to bonds and slight underweight in equities. Although stock markets have rallied, a weaker economy could put pressure on company revenues. Our central case remains falling inflation, a peak in the interest rate cycle and a soft landing, but with a larger than normal risk of a deeper recession.
issued by Omnis Investments. which is authorised and regulated by the Financial Conduct Authority. Registered address: Auckland House, Lydiard Fields, Swindon 5NS 8UB. This update reflects our view at the time of writing and is subject to change The document is for informational purpose only and is not investment advice. We recommend you discuss any investment decisions with your financial adviser. Omnis investments is unable to provide investment advice. Every effort is made to ensure the accuracy of the information, tut no assurance or warranties are given. Past performance should not be considered a guide to future performance.
Approved by Omnis Investments on 2nd August 2024
Essential Wealth Management
1-2 Great Farm Barns
West Woodhay
Newbury
Berkshire RG20 0BP
Tel: 01488 669840
Fax: 01488 669216
Email: [email protected]
Essential Wealth Management is a trading name of Essential Wealth Management and Advice Ltd which is an appointed representative of 2plan wealth management Ltd which is authorised and regulated by the Financial Conduct Authority. Essential Wealth Management and Advice Ltd is entered on the FCA register (www.FCA.org.uk) under no. 518528. Registered office: 1-2 Great Farm Barns, West Woodhay,Newbury, Berkshire RG20 0BP. Registered in England and Wales Number: 04020006.
The Financial Ombudsman Service is available to mediate individual complaints that clients and financial services businesses aren't able to resolve themselves. To contact the Financial Ombudsman Service please visit: http://www.financial-ombudsman.org.uk/contact/index.html
The information on this website is subject to the UK regulatory regime and is therefore targeted at consumers in the UK.
