Asset managers and multi-asset teams cut their exposure to global equities in August as the US-China trade dispute threatened to escalate further and Europe continued to show weakness, with firms now wary of the world sliding into recession.
Recent months have already seen investors rushing to the perceived safety of government bonds, sinking the yield on the benchmark US 10-year Treasury below 1.5% for the first time since 2016 and the 30-year below 2% for the first time ever. Negative interest rates in Europe and Japan, meanwhile, have pushed sovereign debt yields below zero in record numbers. There is now more than $17trn of negative-yielding bonds worldwide. Amid the precarious market outlook, UBS told investors in August that it had moved to an underweight position in global equities for the first time since...
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