Investors’ Chronicle readers have had a sense of déjà vu this summer, with economic concerns looming ahead of the autumn Budget. Despite this, the stock market has continued its upward trend, with shares in the US and UK performing particularly well. Other major equity markets have also seen solid gains in recent months.

The old adage of ‘sell in May’ has once again been proven wrong, as investors have remained optimistic despite warning signs. The US market, in particular, has seen significant growth, even as concerns about central bank independence and policy uncertainty persist. The debate surrounding the end of US exceptionalism continues, with questions about valuation, governance, and institutions still lingering.

While a reckoning may not be imminent, there are signs that investors are starting to take these concerns seriously. Bond yields in various developed markets are on the rise, reflecting unease about fiscal positions and policy decisions. In currency markets, the pound has faced challenges due to high inflation and sluggish growth, while the dollar index remains below pre-pandemic levels.

In contrast, Europe and emerging markets have seen strong performance this year. EMs, in particular, have benefited from a more pragmatic policy approach and a reversal of US dollar strength. Gold, another standout asset class in 2025, has seen a 20% increase in value in sterling terms, reflecting concerns about government actions and overall market uncertainty.

As we head into the autumn, investors are faced with difficult decisions about where to allocate their funds. While the US market continues to thrive, other regions such as Europe and emerging markets offer attractive opportunities. With uncertainty still lingering in the global economy, diversification and careful risk management will be key for investors in the months ahead.