‘Freedom Day’

July 19th was dubbed ‘Freedom Day’ in the UK as the remaining Covid-19 imposed restrictions were lifted; this was at a time when the number of Covid-19 cases had started to increase. This was further highlighted by both the Prime Minister and Chancellor having to self-isolate after having close contact with health minister Sajid Javid, who tested positive for Covid.

Currently and crucially despite an uptick in infection cases the number of deaths caused have not picked to the same extent seen in previous waves. This highlights that vaccines are working in weakening the link between infection and death. This continues to be one of the main drivers of investment markets and across sectors.


During July government bond yields fell, even though inflation figures continued to rise in major developed market economies. Perhaps highlighting that investors are moving slightly more cautiously in their positioning as a function of different variants on future restrictions being imposed. Government bond prices moving lower, and therefore yields moving higher had been a catalyst for more growth and Technology orientated businesses selling off in the Spring. The reversal in fortunes for the bond market was welcomed by the Tech sector with it bouncing back to close at a record high in July.

The risks of investing in emerging markets and specifically China were brought back to the forefront with the Chinese government beginning a crackdown on the $100bn education technology sector as it seeks to rein in the big education and private tutoring companies. At the same time, Tencent announced it was halting registrations on its flagship WeChat app as it undergoes a technical upgrade ‘to align with all relevant laws and regulations”. The combination of this news meant that Chinese equities were under pressure during the month with some heavy falls.

Corporate Activity

Corporate activity has certainly stepped up over the last few months and the amount of Merger and Acquisition announcements in the UK is hitting fresh highs. What’s also interesting is that this spans sectors and across the market capitalisations spectrum. In July this came to the fore again with Morrisons accepting a £6.3bn ($8.7bn) takeover bid by a US private equity group, Fortress Investment Group.


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