-
""

Markets Weekly

28 June 2019

3 minute read

Week ahead

July begins with a shower of key macro data and as the G20 summit unfolds, leaving investors searching for clues on the economic outlook.

Next week the focus is primarily on purchasing managers’ index (PMI) surveys, with major economies releasing final manufacturing and services PMIs for June. In the US, preliminary readings for the month will likely continue to be on a softening path due to waning production volumes, with manufacturing activity weaker than services. The UK is expected to show a similar weakening pattern after May’s surveys recorded a dip in manufacturing courtesy of Brexit uncertainty, partly offset by a modest increase in services activity.

Data out of the eurozone will test the recent upward trend in PMIs, as services remain resilient and manufacturing slightly improved in May despite still contracting. Finally, trade tensions will likely translate into soft June PMIs out of China although, unlike services activity, manufacturing surprisingly held up last month.

The European Central Bank and the Bank of England have recently lowered their growth forecasts but May’s data on broad money growth in the eurozone and the UK is expected to remain healthy and underpin modest output expansion. Markets also await readings on the labour markets from both sides of the Atlantic. The consensus is for unemployment rates in the eurozone (May) and the US (June) to stay around historical lows, while US non-farm payrolls and average hourly earnings growth for June should stabilise after a weak May.

Chart of the week

Golden times

After its best weekly performance in over three years, gold hit a six-year high on 25 June of $1,430 an ounce. Demand for the precious metal (especially in the short run) is wide-ranging from diversifying portfolios, increasing demand for jewellery and in the case of the recent rise, a flight to safety during uncertain times.

Unsurprisingly, the rise came at a time of escalating tensions between the US and Iran and the uncertainty of the G20 summit, where President Trump and President Xi are scheduled to meet.

Gold is a clear winner in today’s uncertain and low-yield environment. Furthermore, leading central banks are turning more dovish and many real rates are deeper in negative territory. Although we think gold will remain an important diversifier, the price will fail to keep its winning streak for long and will soon stabilise.

Chart of the week

""

Ageing population: the golden age of silver spending

How can investors profit from the expected doubling in consumers aged over 65 between 2015 and 2040?

Ageing hands

Outlook for oil prices

How should investors position themselves for prospects in the oil market?

Previous editions of Markets Weekly

Investments can fall as well as rise in value. Your capital or the income generated from your investment may be at risk.

This document has been issued by the Investments division at Barclays Private Banking and Overseas Services (“PBOS”) division and is not a product of the Barclays Research department. Any views expressed may differ from those of Barclays Research. All opinions and estimates included in this document constitute our judgment as of the date of the document and may be subject to change without notice. No representation is made as to the accuracy of the assumptions made within, or completeness of, any modeling, scenario analysis or back-testing.

Barclays is not responsible for information stated to be obtained or derived from third party sources or statistical services, and we do not guarantee the information’s accuracy which may be incomplete or condensed.

This document has been prepared for information purposes only and does not constitute a prospectus, an offer, invitation or solicitation to buy or sell securities and is not intended to provide the sole basis for any evaluation of the securities or any other instrument, which may be discussed in it.

Any offer or entry into any transaction requires Barclays’ subsequent formal agreement which will be subject to internal approvals and execution of binding transaction documents. Any past or simulated past performance including back-testing, modeling or scenario analysis contained herein does not predict and is no indication as to future performance. The value of any investment may also fluctuate as a result of market changes.

Neither Barclays, its affiliates nor any of its directors, officers, employees, representatives or agents, accepts any liability whatsoever for any direct, indirect or consequential losses (in contract, tort or otherwise) arising from the use of this communication or its contents or reliance on the information contained herein, except to the extent this would be prohibited by law or regulation..

This document and the information contained herein may only be distributed and published in jurisdictions in which such distribution and publication is permitted.  You may not distribute this document, in whole or part, without our prior, express written permission. Law or regulation in certain countries may restrict the manner of distribution of this document and persons who come into possession of this document are required to inform themselves of and observe such restrictions.

The contents herein do not constitute investment, legal, tax, accounting or other advice. You should consider your own financial situation, objectives and needs, and conduct your own independent investigation and assessment of the contents of this document, including obtaining investment, legal, tax, accounting and such other advice as you consider necessary or appropriate, before making any investment or other decision.

THIS COMMUNICATION IS PROVIDED FOR INFORMATION PURPOSES ONLY AND IT IS

SUBJECT TO CHANGE. IT IS INDICATIVE ONLY AND IS NOT BINDING.