Asset Allocation for July 2016

Brexit has rocked financial markets in the end of June. How much significant would this event be for world economy we will see in the nearest future.

Volatility splash in equity assets has transferred speculative money in gold and bonds. Nevertheless financial collapse hasn’t occurred for the present. Investor took some time to overvalue new risks for Europe.

European economy hardly started to show first signs of recovery. But increasing in business activity and the inflation growth supported by ECB’s soft monetary policy could stop through Brexit. Business is in need to change its strategic plans in order to conduct new challenges in Europe that could case slowdown of macro economy in the region.

In July the role of event makers will belong to Central Banks. They could take a decision to start further monetary easing that will lead to another bull market in risky assets.

Threat and challenges in world markets:
   - Presidential Elections in US (8th November 2016)
   - Credit market bubble in China
   - Rapid destabilization in the middle East and jump in oil prices
   - BREXIT aftermath – EU disruption and political crisis

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