China’s actions do little to engender confidence

Global capital markets entered an eerily familiar phase in June with the ‘can-kicked-down-the-road’ issue of Greek debt, combining with a rampantly volatile and casino-like Chinese stock market to unsettle investors… All in all, a case of back to the future. As we write this piece, a deal appears to have been done between Greece and its Eurozone creditors - but who can say whether this is the best long-term solution? Given the history of the Eurozone project, it is easy and indeed prudent to be cynical. As long-term investors, we remain uneasy but mindful of the fact that Europe as a region has been economically moribund for the past decade and is likely to remain so. Avoiding systemic fallout across the banking system is probably the best we can all hope for from this deal. China on the other hand – representing circa 17% of global GDP and probably 30% of construction expenditure - gives us cause for greater focus and thought. Read the full report here: (VIEW LINK)