A word from the Director of Management
A good first semester 2017 finally!
The relief to see E. Macron in a favourable ballot in the second round of the presidential elections then his election allowed the European markets to take off, the CAC taking more than 8% in 2 weeks, the Eurostoxx more than 7%.... After this euphoria, June ends with a consolidation on the back of a 6% drop in oil prices following the rise in US stocks.
In the bond markets, last semester was characterized by a lot of volatility.
The election of Donald Trump and the promise of major fiscal stimulus measures had led to a sharp tightening of US interest rates at the end of the year, with the 10-year interest rate rising by nearly 1% to 2.60% in December. Subsequently, the administration's increasing inability to implement the measures of the electoral platform, as well as a marked slowdown in economic growth, led investors to revise downwards the Federal Reserve's inflation and monetary tightening prospects (two rate hikes this year, but financial markets now doubt its ability and willingness to make further hikes). All these factors explain the downward trajectory of US interest rates during the first half of the year (-20 bps to 2.30% at the end of the 10 year period).