Amber River DB Wood News

Sadly, geopolitical tension is becoming part of our everyday news flow and most recently we have seen conflict breakout between Israel and Iran. The Middle East has been an area of contention on and off for several decades, and together with the war in Ukraine, it is concerning that conflicts can simply be allowed to rumble on despite the promises of governments to manage, compromise and dilute the core issues. Even Donald Trump failed in his pre-election pledge to “solve it in a day”.

After a wild month in April, global investment markets took a collective deep breath in May as volatility reduced significantly. The year so far has been largely driven by Trump’s policy agenda, concerns about regional recessions, and inconsistent economic data. At times the data has been suggestive of a slow down and at other points, good growth.

We’re pleased to announce we are changing our name to Amber River DB Wood, with effect from 26 June 2025. DB Wood will still remain the registered legal regulated entity.

The start of April feels like a long time ago. We started the month with so called ‘Liberation Day’, where President Trump quite comically announced sweeping tariffs by holding up a big board. That kickstarted financial market dislocations, which were then reinforced as US-China tensions escalated. Subsequent days saw equity markets fall by 10-15%, and credit and lending markets dry up. After seeing a partial recovery since then, it is easy to now underplay the severity of the market moves, though at one stage we were half a trading day away from a significant liquidity event… Trump’s Truss moment as we noted in our blog a few weeks ago.

Whatever your view of Donald Trump, the chances are that the outcome of the Trade War will help shape how history remembers him. The US (like a lot of the developed world) is carrying a huge national debt. The only way to reduce the debt quickly is for the Government…

Given the political events of the last 10 days or so, we thought it appropriate to send out an interim note to clients, to keep you as informed as we can as to what we believe is happening, how the uncertainty is playing out, and where we are positioned from an investment perspective.

We came into 2025 cautiously optimistic. With high income yields, inflation sticky, though generally trending downwards, and economic growth in most parts of the world holding up. The investment backdrop was favourable. That was the optimism part. The caution? Well, markets had started to count on Trump 2.0 as a…

They say a week is a long time in politics, but in the case of the new US administration, that should probably be re-framed to a day is a long time in politics. Trump and his team are certainly ruffling some feathers in investment markets.

Diversification is a key cornerstone of portfolio management, as it aims to reduce risk and provide a platform for sustainable growth across a range of investment environments. We are multi-asset investors, with the objective to deliver robust returns over the medium to longer term, without over exposing clients to one particular risk.

OpenAI started life in 2015 as a research organisation with a mission to migrate AI safely into humanity. On the 30th November 2022, they released a landmark AI chatbot, called ChatGPT, that has subsequently been doped AI’s ‘iPhone moment’. It was the fastest adopted internet application in history, growing to 100 million users just 2.5 months after its launch, much faster than previous records set by the likes of Instagram and TikTok.

Well, we’ve certainly had quieter starts to the year. In the first month of 2025 we’ve had positively surprising inflation data, an AI breakthrough out of China, and the start of the tariff games. Market volatility has picked up, as the world takes stock of the infamous new US President.

It’s been a tough few months for the tax landscape. For many clients, 2025 will see a change of direction for their financial planning, as we adjust following the recent budget, which delivered some significant changes to the way many assets are taxed.

When we sat here a year ago writing this update, markets were expecting an imminent recession with the expectation that interest rates would come down quickly to compensate. At the time we didn’t think that the outlook for the UK economy was quite that bad, though we were positioned for a more controlled reduction in interest rates as growth slowed manageably.

2024 has definitely been a year of change. A new government, a new tax landscape, and thankfully, a much-improved investment backdrop. They wouldn’t all quite have got onto our 2024 Christmas card list, but we’ll definitely take the last one!

We always felt that the last quarter of the year would be the trickiest, mainly due to the uncertainty surrounding the US election and UK budget. Whatever you think about the outcomes, the fact that they are now past events, should help the direction of markets. Volatility will remain as markets try to estimate the potential implications from each event.

For investment markets the US election was always likely to be the biggest event of the year. It seemed close throughout the campaigns, but in the end Donald J Trump won a clean sweep of both sides of the US political system. The day before the result one US pollster declared that the most likely outcome was Trump by a big margin, and second most likely, Harris by a big margin… such is the divergence of the US electorate these days.

At a simple level, budgets come down to the relationship between two numbers, firstly how much is the Government going to borrow and secondly, how much tax revenue does it need to raise to pay for it. This budget was always going to see an increase to both sides of that equation, in the form of higher taxes to fund increased spending. The spending was deemed necessary to stimulate the growth required to get the UK out of a so called ‘black hole’. So, like any investment, over the years ahead if the investment is prudent, we should see improved economic returns in the future in the form of increases in growth.

“I had too much time to think” he said as he put the easiest forehand he’d had all day straight into the net. The comment is a classic, reflecting the idea that when you have time to think your mind can over analyse the options. This can often result in poor decision making and execution.

Just like the UK weather, a summer in investing can often be hit and miss. The phrase “sell in May, go away, and come back on St Ledger Day” seems to do the rounds every year in late spring, suggesting Q3 has historically had its challenges. As we closed on the end of the first half of the calendar year, economic growth looked ok, inflation was on the back foot and interest rates look set to be reduced for the first time since 2020, so the backdrop was more positive this time around.

Since the end of 2022 we have had a positive outlook on investment markets. That was the point of peak fear when inflation had just hit 10% and interest rates were quickly being increased. All markets were struggling to adjust, though we also expected that as those variables came more under control, investors would regain confidence.