Desperately seeking data and summer lulls

An excerpt and link to our weekly market overview from Quilter Cheviot

Market overview

Last week was relatively light on the economic data front. How light? Hardly anything of note came out of the UK. In the US, there was the Institute for Supply Management’ services Purchasing Managers’ Index (PMI).  June’s reading of 54.0 was down on May’s 54.5 but came in line with expectations. With prints above 50 indicating expansion, June’s number makes it 24 months in a row of expansion. There were also initial jobless claims for the week ended 4 July which, at 215k, was a little shy of the previous week’s 217k. Apart from some housing data that was pretty much it in terms of numbers coming out of the US.

A bit more to talk about in Europe. A drop in Germany’s annual inflation rate to 2.3% in June from May’s 2.6% was in line with expectations. What was not expected was a 0.9% month-on-month (MoM) increase in exports, a slight increase on the 0.8% seen in April and way above the 0.3% decline the market had been expecting. The beat was put down to higher exports to the US.

Elsewhere, household consumption in the Netherlands grew 1.8% year on year (YoY) in May 2026, an increase on the 1.0% growth seen in April and the highest it’s been for over a year. Meanwhile, Sweden’s economy grew 0.9% MoM in May, an acceleration on April’s 0.6% and the third consecutive month of growth; while consumer prices were up 0.7% YoY in June, slightly down on May’s 0.8% thanks to lower food and transport prices. Not often Dutch and Swedish data feature in the Weekly Comment. Economic releases were that light.

Summer lull?

It wasn’t just the data, trading volumes too were subdued, although that didn’t stop global equities from ending the week in positive territory. The first signs of a summer trading lull, or just a pause for breath before normal service resumes?

Or a blip?

The latter looks the more likely, particularly when this week is set against the backdrop of an increasingly fragile-looking ceasefire in the Middle East following an escalation in tit-for-tat strikes between Iran and the US.

Aside from renewed concerns in the Middle East, the Q2 earnings reporting season is also due to kick off with a host of US banks including JPMorgan Chase, Goldman Sachs, Morgan Stanley, Bank of America and Citigroup all due to report.  No shortage of economic news either. Inflation data for the US and the Eurozone, UK GDP figures for May along with retail sales data, just some of the standout releases due out. Plenty to get stuck into this coming week then.

New PM?

And in the UK, Andy Burnham could take over as prime minister from Sir Keir Starmer as early as next week after the former Manchester mayor secured the backing of 322 out of Labour’s 403 members of parliament. Such a high level of support could see Burnham declared the new Labour leader on Friday 17 July and move into Downing Street (London or Manchester?) as early as Monday 20 July.

A busy week ahead then. Suddenly a summer lull doesn’t sound so bad.

Weekly market moves:

The MSCI All Country World Index (MSCI ACWI) ticked 0.3% higher, bringing the year-to-date (YTD) gain to 12.2%…

The value of your investments and the income from them can fall and you may not recover what you invested.