June’s investment market commentary

Financial markets remained volatile in June and riskier assets began to recover from the appalling first quarter falls, as Andrew Yeadon’s update explains.
Share on facebook
Share on linkedin
Share on twitter
Share on email
Published 7 July
3 mins

While financial markets remained volatile, June saw risk assets climbing a wall of worry as financial markets further recovered from the appalling first quarter drawdown. Off a low base, economic activity picked up as restrictions were eased and the growth rate of COVID-19 cases slowed. 

Investors continued to take comfort from the remarkable levels of stimulus governments and central banks are providing across the world, although towards the end of the month there were worrying signs that the pandemic was accelerating again, most notably in the US Sun Belt states.

On the political front, tensions between China and most other countries (which were already frayed by COVID-19), increased as China imposed draconian anti-sedition laws on Hong Kong Special Administrative Region that many believe effectively ends the “one country / two systems” arrangement put in place when the UK handed Hong Kong to China in 1997. In response, the UK invited up to three million Hong Kong holders of UK overseas passports to come to Britain, while the US suspended Hong Kong’s special trading status and imposed sanctions.


With the race for the presidency now in its final few months, Trump’s poor handling of both the pandemic and racial protests has seen his approval ratings slump, and Democrat nominee Biden to take a meaningful lead in the polls. How Trump reacts to this shift remains to be seen. While a Biden victory would probably help ease global political tensions, he would also seek to reverse some of Trump’s tax cuts and deregulation, which would be less investor friendly.

Corporate news flow was relatively quiet ahead of the July second quarter reporting season. In Germany, the Wirecard fraud was the biggest in the country’s history, causing significant losses for shareholders. Elsewhere, an increasing number of large companies announced restructuring plans involving significant redundancies as fiscal support programs and furlough schemes near their target end dates. Many companies also continued to raise capital and reduce dividends in order to maintain sufficient liquidity.


Equities continued their recovery, with most major markets and sectors delivering gains. Over the month, the MSCI AC World Index rose +2.7% in sterling terms. At the country and regional level, Asia ex Japan (+7.8%) and Emerging Markets (+6.8%) led, while the US (+1.7%) and the UK (+0.9%) underperformed. At the sector level, information technology (+7.0%) and consumer discretionary (+4.8%) were the best performers, with healthcare (-1.2%) and utilities (-1.6%) the weakest. From a style perspective, investors continued to back growth (+4.6%) more strongly than value (+0.8%). The performance of smaller company stocks (+2.7%) broadly matched their larger company peers (+2.7%).

Fixed income also saw positive returns with sovereign bond yields generally drifting lower. Central bank support continued to encourage some investors to return to higher yielding assets, with riskier types of bonds seeing the strongest returns. Over June, the JP Morgan Global Government Bond Index delivered a return of +0.2%, while shrinking spreads saw the ICE Merrill Lynch Global Corporate Investment Grade and High Yield Bond Indices gain +1.8% and +1.7% respectively (all hedged to sterling).


Most commodities gained as the Bloomberg Commodities Index rose +1.8% on the month. The largest advances were in crude oil (+8.1%) and industrial metals (+6.3%) as hopes of economic recovery helped claw back some of the significant losses seen earlier in the year. Nonetheless, commodities sent mixed messages as more cautious investors took comfort in buying gold (+2.3%), either as a hedge or safe haven.

Foreign exchange markets were relatively quiet, with the Yen, Euro, Sterling and the US Dollar all fairly stable against each other. Currencies that weakened included some of the traditional safe haven currencies, such as the Swiss Franc, while an improvement in demand and pricing for commodities helped boost the Canadian and Australian Dollars.


(Notes: All monthly data is quoted in sterling terms unless otherwise stated).

FTSE 1006076.66169.74
DJ Ind Average25383.1125812.88
S&P Comp3044.313100.29
£ Base Rate0.100.10
Brent Crude37.8441.27

Clients of Nedbank Private Wealth can get in touch with their private bankers directly to understand how their portfolios are responding to market events or call +44 (0)1624 645000 and speak to our client services team.


If you would like to find out more about how we help manage clients’ investments, please also contact us on the number above. Or you can get in touch using the links to the forms towards the end of this page.

Investments can go down, as well as up, to the extent that you might get back less than the total you originally invested. Exchange rates also impact the value of your investments. Past performance is no guide to future returns. Any individual investment or security mentioned here may not be suitable, and is included for information only and is not a recommendation. You should always seek professional advice before making any investment decisions.

about the author

No data was found

Access more of our insights


The week in review

3 Aug

   |   5 mins

In a review of the week of 26 July, some economies showed signs of recovery but emerging markets remain hindered by the continued spread of the COVID-19 Delta variant, the speed of their vaccine rollouts and China’s regulatory crackdown.


The week in review

26 Jul

   |   2 mins

In a review of the week of 19 July, we flag the new developments in financial markets, which continued to be dominated by the same reoccurring themes of inflation, central banks’ intervention and the spread of the COVID-19 Delta variant.


The week in review

20 Jul

   |   2 mins

We review the week starting 12 July, which saw markets slip back from recent highs amid continued concerns over the spread of the COVID-19 Delta variant. Meanwhile, the debate carries on about how transitory inflation might be.


Democracy, pineapples and semiconductors

20 Jul

   |   8 mins

As the semiconductor industry saw a global shortage the relationship between China and the US got tenser, particularly with regard to Taiwan. Karen Bennett and Rebecca Cretney highlight what’s going on and what investors should be aware of.

Get in touch

If you are interested in becoming a client, please complete the form via the ‘become a client’ button below. Alternatively, if you are already a client, or if you have a question about how we help clients in particular circumstances, please use the ‘contact us’ button.

We will get back to you as soon as we can during office hours, which are Monday to Friday, 8am to 8pm (UK time), except for UK public holidays.

Become a Client

Thank you for your interest in Nedbank Private Wealth. Please call us on +44 (0)1624 645000 or complete the requested information and one of our team will get back to you soon. We look forward to speaking with you.  Please note: If you are an EU resident, we are unfortunately unable to offer our services to you at present.

* Required fields

Contact Us

Give us a call today on +44 (0)1624 645000 or please complete the requested information and one of our team will get back to you soon. We look forward to speaking with you.

Our office hours are weekdays from 8am to 8pm UK time, except for UK public holidays.

* Required field

Search suggestions


Beware of scams using Nedbank Private Wealth’s name.


Have you received an email or SMS claiming to be from Nedbank Private Wealth, inviting you to open an account?


Don’t be tricked – Nedbank Private Wealth never contacts members of the public directly, and will never use email or text messages to ask you for your bank details or sensitive personal information.


We are aware of scams using our name and those of our staff. These are usually intended to convince you to send money to the scammers, who use our name because it sounds legitimate.


If you are in any doubt about whether an email or SMS in our name is legitimate, please speak to your private banker, or call the telephone numbers on the “Contact us” page.