What Can Investors Expect in the Second Half of the Year?

A sell-off surprised at the end of 2018 but this year has seen a strong recovery so far. How should investors position themselves for the rest of the year? 

Hannah Smith 25 July, 2019 | 9:24AM

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After a sharp sell-off caught investors by surprise in the fourth quarter of last year, the first half of 2019 has seen a welcome rebound. But can this run continue, what macro shocks could be on the cards for the next six months, and how should investors position themselves?

Inflation Shock?

HSBC Global Asset Management’s global chief strategist Joseph Little points to inflation as one neglected risk that could cause instability for investors if there is an unexpected rise. At the latest reading, UK Consumer Prices Index (CPI) inflation rose 2% in June from a year ago, in line with the Bank of England’s 2% target. He says: “We don’t expect inflation to increase significantly in the near term, but it wouldn’t take much of an upward surprise in inflation or interest rates to change the current pricing in fixed income assets, such as bonds.”.

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About Author

Hannah Smith  is a freelance financial journalist

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