August is traditionally known as a slow month for financial markets, with lower volumes contributing to lackluster movements. This year’s iteration however went somewhat against the grain, with solid performance in both fixed income and equity markets.
Amongst developed market equities the US was the standout performer with the NASDAQ Composite leading the way, returning +4.82% as the recent tech rally continued. The S&P 500 finally breached the key psychological level of 2,000 on the 25th of August after several previous attempts and finished the month +3.77%, closing above 2,000 for the first time ever at month end. Although European investors salivated at the prospect of further stimulus measures as data continues to disappoint, the core region gave a mixed performance; the CAC 40 faired best, adding +3.18% with the DAX +0.67% and the FTSE MIB -0.58%. Investors also continued to buy into emerging market equities and the Brazilian market in particular saw strength, with the Bovespa adding +9.78% on the month.