We are confident that the recent equity market sell-off is a stumble. But the damage to equity indices might take some time to repair even if we are already seeing positive days emerge. For equity investors, the question is whether the bounce off lows is sustainable. At this stage, we are doubtful as trade related uncertainty has not yet passed and downside growth risks remain high. If the US economy emerges through recent headwinds with just a modest growth downgrade, then equities will trade meaningfully higher through year end. But until we have this transparency, the path will remain bumpy.
