Don’t look down

Global equities have been on a pretty rapid ascent since the start of the year. Last week the world’s
investors had a bout of looking down, and a mild attack of vertigo. This dizziness has been prompted by
some reasonable worries. Do we have enough food (earnings growth) to carry on? Is the strong tailwind
(in the form of liquidity) about to turn into a headwind? Has one of our party (China) already started
slipping back down?

We’ve been going through these thoughts in our quarterly investment committee meetings, and the main
conclusion is that things are generally likely to

Asset returns review: June 2021

Markets experienced another leg up in June, continuing a positive year for investors. It brings us to the end
of another quarter in which good returns were found in almost all asset classes. In the first three months
of this year, returns were plentiful but unevenly spread, with equities and riskier assets rallying while bonds
struggled. Q2 was more equitable by contrast: investors holding more fixed interest bonds over equities
also did well.

Private equity gets a good deal on UK plc

After weeks of courtship, supermarket chain Wm Morrison has at last picked a suitor. That’s the official
story at least. Morrisons began as a Bradford-based grocer, but after buying the Safeway chain of nationwide
stores it expanded beyond Yorkshire to become the fourth supermarket chain behind Tesco, Sainsbury,
and ASDA. Last week, a trio of private equity groups, led by the aptly named Fortress, struck a £9.5 billion
deal to end the bidding war. The price accepted by the Morrisons board was a 42% mark-up from the
company’s share price before the takeover bidding began.

Read the full commentary here