As Lionel Richie put it in his 1980’s hit, “What is happening here? Something’s going on that’s not quite clear.”

After a sustained period of outperformance versus other regions, European equity markets have underperformed in recent weeks. This shift was marked by a notable rotation into US technology stocks during the month of June.

June proved to be a fraught month for market participants—marked not only by record-breaking heatwaves, but also by a barrage of geopolitical and macroeconomic developments that tested investor nerves.

Inflation will be a central focus for global investors, with key reports expected from the US, UK, Canada, and Japan. US inflation data is expected to show an acceleration in June.

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After the big bill last week, markets will focused on big tariffs as little clarity has emerged on what will happen as the tariff deadline looms.

As we write these lines, the US market is approaching its historical peak, last reached in February 2025, and most asset classes have posted positive returns in local currency since the start of the year.

Despite rising geopolitical tensions, the global economy showed surprising resilience in early 2025, and inflation continued to normalise.