Uncertainty reigns in European markets

Low rate era: Commuters pass the Bank of England in the City of London. Lower policy rates are also a concern for UK banks following the Bank of England’s decision to cut rates and restart quantitative easing. – Bloomberg

THE outlook for equity markets in the second half has become more challenging.

For one, investors will need to weigh the implications of the UK’s decision to leave the European Union (EU). Second, the European Banking Authority stress tests could lead to a renewed round of cash raising from investors by banks as well as further pressure on dividends.