So, it seems that all is right with the world again.  What were we all thinking?

Policymakers across the globe have taken comfort in the flattening of the COVID-19 curve and starting to reopen their economies which is necessary to avoid the significant economic damage from becoming a real long-term problem. However, it will also invite greater COVID-19 infections that could provide a restraint on economic growth, at least until vaccine is developed and widely disseminated.

Markets seem priced for a smooth return to normality and business as usual, which is the most positive of scenarios and time will tell if COVID-19 has a sting in its tail and a second wave disrupts the global economy further. There are other things to consider, which are discussed in the commentary, but markets are focussed on the virus for now.

It seems that the worst case scenario of the COVID crisis morphing into a liquidity crunch has been avoided, and central banks are committed to providing liquidity support where necessary, so this may support markets for a while but it is unclear how long it will be before fundamentals drivers are again part of the conversation, rather than the amount and character of Central Bank and Government stimulus.

To help with the understanding of some of the more technical elements of the commentary, we have created a Glossary of Investment Terms which should explain any of the more technical terms contained within the commentary.

Please note that the document is a summary of certain views, which have been discussed at our Investment Strategy Committee meeting.  We are always happy to discuss further anything touched upon or indeed any other investment or economic themes that may concern you.

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