Market Turmoil as Global Economy Rebounds, Oil Prices Soar

The global economy rebounded strongly over June and July, driven by positive industrial momentum, which has led to higher inflation concerns and rising bond yields.

This reflationary environment supports value-oriented global stocks and real assets such as infrastructure and commodities.

However, the flow of oil and gas out of the Gulf has been interrupted again due to military action, increasing the risk of stagflation worldwide.

The price of oil refiners is benefiting from record refining margins on oil products.

Copper prices are strong, but gold has diverged from copper in recent months due to rising bond yields and a stronger US dollar.

Central banks have increased their gold purchases, while copper remains supported by electrification, tech, and defense demand.

The AI investment theme has corrected sharply since May, with hyperscalers falling 19% during this period.

Global financials have taken over market leadership, boosted by strong US Q2 results.

The report suggests diversifying out of concentrated technology positions into value and US small-cap stock exposure.