Michael Arone, CFA, Chief Investment Strategist, State Street
This post was written with contributions from Charlotte Irwin. Charlotte is a Research Strategist in the ETF and Mutual Fund Research Team at State Street.
The Democratic presidential candidates weren’t the only ones in Miami whose blood was boiling. As the first presidential debates wrapped up, the sun set on one of the city’s hottest Junes ever, with seven record-setting days.
The heat in Florida might have been oppressive, but it was not exceptional. A heat wave also is pushing across Europe. Temperatures in southern France recently hit an all-time record 115°F. In Spain, temperatures soared to 104°F, fueling a 16,000-acre wildfire in Catalonia. These heat waves come at the same time that massive flooding and tornadoes inundated swaths of the US heartland in the second wettest May on record.
Extreme weather is on the rise. Since 1980, the US has experienced 246 billion-dollar disasters—44% of which have occurred in the past 10 years alone. Such events also have become more expensive, costing the economy more than $1.1 trillion since 2005 and $500 billion in just the past five years.
So far, this summer’s extreme weather has had little impact on the markets, except for the price fluctuation of some agricultural products, especially corn and soybeans. However, as economic data is released this month and next, we might see a negative impact from our wet, hot American summer.
For more, please read the rest of the post originally published on the SPDR Blog on July 10.
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