With the partisan divide hardening in the run-up to November 5, the presidential race was revived with the withdrawal of Joe Biden at the end of July. In just a few weeks, Kamala Harris has breathed new energy into the Democratic campaign.

It is not unusual for markets to experience volatility spikes during lighter trading volume summer periods.

In August, European equities closed the month a bit higher despite some volatility.

We maintain a constructive outlook on equities but proceed cautiously in the short term.

August was no by means all rest and relaxation for market participants.

All eyes will be on the Federal Reserve Bank meeting. A rate cut is as good as done and the Fed can surprise with a dovish stance but it cannot surprise with a hawkish one.

The investment landscape is evolving against a backdrop of rising economic uncertainties and a cautious market environment, further complicated by geopolitical tensions and upcoming elections.

The ECB is expected to ease monetary policy by further 25bp as both prices and activity are cooling.