Few market participants guessed that the Federal Reserve lifting interest rates, while retreating from quantitative easing would provide such an emotional journey.

NN Investment Partners found that emotion over global equity markets has greatly deteriorated since early March, to its weakest level since early 2017. Optimists cite global expansion, but NN also tested that theory. Its Global Cycle Indicator captured over 70 household and business surveys globally and revealed that, for the first time since 2016, business cycle momentum was no longer improving, compared to three months earlier.

Valentijn van Nieuwenhuijzen, CIO of NN, said this explained why the market has become more exposed to risk factors stemming from politics or headwinds for the technology sector.

Tax reform, regulatory reform and infrastructure spending should have encouraged greater capital spending to stretch out the economic cycle, but c-suite confidence has been sapped by tough trade talk, Syria and every other threat Trump makes.

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