Imperium Capital Publication

Viewpoint – September 2017

Economic trends globally remained broadly favourable and constructive for risk assets, demonstrated by equity markets realising positive returns for a tenth successive month. Despite this, a number of factors served to disturb markets and spike volatility to the highest levels since the US election. Three events were of particular concern to investors and led to flows into more defensive assets. Firstly, the serious escalation in the North Korean nuclear weapons crisis and increasingly bellicose rhetoric from the Trump administration has risen the risk of military conflict involving the US, China and Russia, potentially leading to dramatic global consequences. Secondly, Texas was hit by Hurricane Harvey, one of the strongest hurricanes ever to reach mainland US, causing immense damage, cost and disruption. Gasoline prices were immediately affected with the hurricane decommissioning 20% of US refining capacity, whilst insurance sector stocks fell steeply. Thirdly, the US debt limit came into light once again, with congress needing to raise the ceiling by 3rd October 2017 to avoid default.

Weekly Digest – 24 September 2017

  • Angela Merkel wins German election
  • Federal Reserve to begin balance sheet reduction in October
  • US President Trump imposes fresh sanctions on North Korea
  • China long-term sovereign credit rating downgraded by S&P
  • Theresa May clarifies Brexit stance in Florence speech

Weekly Digest – 10 September 2017

  • Oil prices rose 2% on the week with Brent at USD 53.9
  • Gold rose 1.9 % to 1347, its third week of gains
  • Risk appetite returns as treasuries retreat, stocks advance
  • Apple set to launch the iPhone 8 and X models this week
  • Hurricane Irma devastates the Caribbean and Florida