Choppy ride into year-end

Credit still holds some lure…

China, that ol’ chestnut. More signs of a slowdown as evidenced at the end of last week by European luxury goods makers reported earnings was enough to derail immediate hopes that a post-midterm election boost was going to be sustained.

The bullish assessment on the US economy after the latest FOMC meaning that rate hikes for December and (at least 3?) in 2019 coupled with those trade tariffs are putting the squeeze on the domestic Chinese economy. Weakness in Chinese markets thus filtered through to Europe with stocks in the red into the close, but more angst awaits us at the open as the US closed up to 1.6% lower (Nasdaq). Equities are likely going to underperform this year and fixed income, though slightly in the red in total returns terms, is going to be the best of the bunch. Credit especially so.

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