Global equity markets have maintained their poise so far in 2018 while fixed interest investments have held relatively steady as the threat of faster interest rate increases has generally eased in developed markets. Positive factors include the slow return of significant inflationary pressures (with the exception of the oil price where Brent Crude has risen by over 50% since May 2017), politics in southern Europe are for the moment at least a little calmer, the prospects for major confrontation in the Korean peninsula have eased while that long term driver of equity values, company profits, has been more positive than anticipated.

There are clearly concerns, perhaps most notably around the imposition of tariffs on goods imported by the USA from its immediate neighbours, from China and the EU. Reciprocal action by those exporting countries can reasonably be anticipated: it remains to be seen whether this has the potential to develop into a trade war with potentially damaging implications for the growth of global business. This issue is one that will take considerable time to resolve and for the moment we are not greatly troubled by it.

In summary, we are generally happy to maintain our view that medium and long term investors should continue to focus principally on equity markets rather than on the more cautious alternatives, where appropriate for individual clients.