“Weak global growth, the investment freeze and the collapse of trade drove the Federal Reserve to cut interest rates by a quarter point on 31 July. This should attenuate the slowdown in the US economy, gripped by doubts fuelled by tariffs and the petering out of the fiscal expansion effect. Indeed, tensions between the United States and its trade partners remain the greatest source of uncertainty, and after more than one year of discussions, marked by ups and downs, relations with China seemed to have entered a positive phase, especially after the G20. However, we remain of the idea that the conflict between the US and China remains a secular theme for global economic supremacy”.

These are the words of Moreno Zani, Chairman of Tendercapital, an international player in the asset management sector which actively manages a selected range of tailor-made UCITS V and Alternative products. The European group, based on London, has developed over time and, aside from the United Kingdom, currently has a presence in Ireland, Italy, Switzerland and soon France, where it provides investment management services to institutional investors and HNWIs.

As regards the macroeconomic environment in Europe, according to Zani there are “signs of a slowdown for the European economy, but it is the sentiment on future expectations, weighed down by continuing weakness in the industrial/manufacturing sector, that is really concerning. Orders down, erosion of the backlog and lower investments have brought with them the first negative signs in the job market, with the largest sector-based drop in jobs of the last economic cycle in July. The sentiment on expectations concerning business 12 months out has declined to its lowest levels of the last four and a half years, underscoring how difficulties in the industrial context and the trade theme are having an impact on services as well”. Therefore, against this backdrop, Zani continues, “Tendercapital is maintaining a prudent approach overall in the bond market, with short durations, while in the European equity market our view remains cautious, preferring exposure to defensive sectors over cyclical ones.”

Also in Europe, according to Zani “uncertainties surrounding Brexit are having a negative effect and have been made even worse by the new government led by Boris Johnson, who has not yet let go of his election campaign rhetoric, and whose government seems to be oriented towards a no-deal exit from the EU. We investors are continuing to hope for a deal, even a last minute one”.