Global shares were mixed in June with European indices losing modestly and US and Asian indices gaining some ground. Tariff news continued to occupy headlines as the July deadline approached, though the markets were not as volatile as earlier in the year, anticipating further delays, amendments and potential cancelations. The latest news was that Trump was simply going to send out letters to various countries, saying what tariff they'll get. Meanwhile those countries are scrambling to avoid the trade war from escalating.

In other geopolitical news, Israel started striking Iran with the US bombing Iran's nuclear facilities a week later. This caused the oil price the briefly spike above $70 per barrel but, as a ceasefire was quickly reached, oil closed the month at 65,11 dollars per barrel, up 7,11%.

In the US, economic data generally remained resilient although Q1 GDP fell by 0,5%. This was due to higher imports in the quarter, which likely occurred as a result of concerns around future tariffs. Employment data largely remained resilient. Concern on US debt increased however as Trump’s budget bill (»Reconciliation Bill«) was approved after a few modifications and would allow for the national debt to increase beyond 40 trillion dollars which, if achieved would mean the US's debt to GDP would climb to around 130%, well above Europe's average and nearly twice that of Germany. Despite Trump's continuous attacks on FED chair Jerome Powell, the FED once again kept the interest rate at the same level. Meanwhile the dollar continued to devalue to 1,1787 or 3,87% against the Euro.

The Dow Jones index gained 4,32%, the S&P500 4,96% and the Nasdaq Composite 6,57%, though these gains were largely tempered by the devaluation of the dollar.

European stock markets suffered modest losses with the Eurostoxx dropping 1,18%, the German DAX dropping 0,37% and French CAC index dropping 1,11%. Slovenia's SBI index once again outperformed other European indices, adding 4,91%, closing at 2279,86. The ECB once again cut the interest rate by 0,25% to 2,00% as Eurozone inflation remained at the ECB target rate of 2% and core inflation stood at 2,3%.

The Japanese Nikkei 225 gained 6,64%. Many Japanese companies released full-year results and provided guidance for fiscal 2025. Although earnings forecasts were cautious, shareholder returns through dividend increases and buybacks rose significantly. Also the Hong Kong Hang Seng index gained 3,36%.

Rudy Marchant
Fund manager Primorski skladi

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