Tornado rather than hurricane
After stocks sank in early August, we warned that volatility could ripple on, and the market storm turn into a full-blown hurricane. But last week saw a remarkable dying-down of the volatility, like a whirlwind that passes in an hour: stock markets climbed up all over the world, with no hint of pullback. The rally has been so strong that global stocks are almost exactly where they were at the end of July – before the sharp sell-off. Fears that sparked the midsummer sell-off seem to have faded too, helped by stronger-than-expected US economic data.
Would ‘Kamalanomics’ mean us fiscal expansion?
With just over 80 days until the US presidential election, Vice-President Kamala Harris has become the favourite to win. The gap between her chances and those of former president Donald Trump is very slight (the odds are close enough to be a toss-up) but consistent across all the major indicators: she leads in the polls, in betting and prediction markets, and the most renowned election forecasts.
The long-term case for Japan
Drama is not something Japanese markets are that used to – or, clearly, that fond of – but the nation’s currency and stock exchanges were at the centre of a global surge in volatility over the last few weeks. The TOPIX, Japan’s benchmark equity index, lost over 20% from the open on 1 August to the lowest point on 5 August. It has regained almost all since, now down less than 2% at the time of writing.