Our economic review is intended to provide background to recent developments in investment
markets as well as to give an indication of how some key issues could impact in the future.
It is not intended that individual investment decisions should be taken based on this information; we are
always ready to discuss your individual requirements. We hope you will find this review to be of interest.
Major benchmarks closed the month in positive
territory, as some economic data boosted sentiment
towards the end of the month. A record jump in US
housing sales and a fourth straight month of growth
in Chinese manufacturing, served to offset some
concerns over COVID-19 infection rates.
• In the UK, the FTSE 100 gained 1.53% in June, to
6,169.74, the domestically focused FTSE 250 rose
0.45% in the month to close on 17,119.16. The Junior
AIM index closed on 883.75, a monthly gain of 0.96%.
The blue chip index closed Q2 up 8.78%, its biggest
quarterly gain since 2010, as a host of global stimulus
and an uptick in business activity as lockdown
measures ease, strengthened optimism about a postpandemic
economic recovery. Concerns do exist, as
local lockdown measures were imposed on Leicester
due to virus flare-ups in the city.
• On European markets, the Euro Stoxx gained 1.88%. In the US, the Dow Jones advanced
1.69% in the month to 25,812.88, while the tech
orientated NASDAQ returned 5.99% to finish June on
10,058.77. The Dow jumped over 17%, and the NASDAQ
over 30% in Q2, marking these indices’ best overall
quarters since 1987 and 2001, respectively.
• On the foreign exchanges, sterling closed the
month at $1.23 against the US dollar. The euro
closed at €1.10 against sterling and at $1.12 against
the US dollar.
• Gold is currently trading at around $1,783 a troy
ounce, a gain of 3.09% on the month. Investors are
keeping the precious metal in bullish territory despite
a surge in risk appetite. Brent Crude is currently
trading at around $41 per barrel, a gain of around 15%
on the month. A recent poll, highlights expectations
of a modest recovery in oil demand in Q3 and a
stronger rebound towards the end of the year and
into next, as oil demand is expected to pick up. SFFS Economic Review_June 20 (003)