Resilient growth and rising markets mask underlying structural tensions – the risks of a misstep are accumulating. We assess the balance for investors.

This week we focus on the diverging chances of a rate cut in December from the Bank of England (BoE) and the Federal Reserve (Fed).

We maintain a constructive outlook for equities, with a broadening of opportunities for selective investment, backed by disciplined diversification.

The Chanceller’s job of balancing UK finances hasn’t been helped by gilts. Since the election in July 2024, borrowing costs have been higher than the government would like. But one question still gets too little scrutiny: to what degree is the BoE’s QT programme responsible?

Chancellor Rachel Reeves achieved her budgetary goals: – the OBR is happy, markets are calm, and Labour backbenchers are content. But is that good enough?

The region has exited post-Covid stagflation, with inflation falling and interest rates easing, so economic performance has turned round. America, by contrast, faces stagflation

The US government’s proposal to impose tariffs on pharmaceutical imports has ignited a complex debate, intertwining economic, healthcare, and geopolitical considerations. While the initiative aims to bolster domestic manufacturing and reduce reliance on foreign supply chains, it also raises concerns about drug affordability and availability, and has broader implications for the healthcare system.

We don’t pretend to have all the answers on China and the US, and we reserve the right to change our minds – especially as Donald Trump changes his. Amid such market volatility we are not making bold macro calls, instead our focus is on thoughtful, quality-led stock selection.

Fundamental backdrop remains solid – many companies are performing well and first quarter earnings were healthy. Shareholder interests remain to the fore with buybacks tripled year-on-year in April. Merger and acquisition activity has been widespread.

We cannot ignore the dominant themes impacting markets across the world, but a resilient and supported European marketplace is well placed to prosper in these challenging times

As investors navigate a slower growth, policy-fragmented environment, AI stands out as a long-term theme with the potential to deliver durable growth and broad-based opportunity across the value chain

Market Perspectives: 2025 half time report – where to next?

Explore how reo® has shaped corporate behaviour and achieved over 5,170 milestones through engagement with 6,454 companies since 2000.

Geopolitical tensions, tariff uncertainty and global economic slowdown look set to define the second half of 2025. Our global CIO looks at why active management and research-led investing are the way to navigate this global complexity.

AI is helping enhance efficiency, reduce costs and improve decision-making.

At COP28, over 20 countries committed to tripling nuclear power by 2050. Driven by energy security and AI, the sector could attract $550 billion in investment. Small Modular Reactors offer cost-effective solutions. Key beneficiaries include uranium producers, reactor manufacturers, engineering firms, and select utilities supporting the nuclear power revival.

I spend about nine weeks a year in a rental car looking for companies all over the world, discovering their products, operations and customers. Here's what I'm looking for.

While Labour’s first Budget was a surprise in terms of the scale of the fiscal loosening, there remain grounds for cautious optimism about UK equities.