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Shortly after, Chinese policymakers allowed the yuan to sink below 7 against the U.S. dollar for the first time since the global financial crisis, an apparent countermeasure to blunt the effect of the increased tariffs, which then prompted the U.S. Treasury to formally label China a "currency manipulator."

Tensions continued to build, with China adding more tariffs on U.S. goods.

The trade developments, coupled with enduring global growth concerns, triggered a "risk-off" reaction across markets Global stocks (MSCI World Index) fell over 2%, credit spreads widened, inflation expectations dropped considerably, and 30-year sovereign bond yields from the U.S. to the U.K. to Germany fell by a startling 30-60 basis points, The better performing sectors were Utilities (+5.24%), Consumer Staples (+1.92%) and Healthcare (-0.73%).

While underperforming sectors were Energy (-9.53%), Financials (-6.01%) and Industrials (-3.57%).

For the month, global equities showed a declining trend across different regions. The MSCI ACWI Index decreased -2.57% (+12.12% YTD) and the MSCI EAFE Index decreased -2.88% (+7.23% YTD).

The MSCI Emerging Market Index decreased -5.08% for the month (+1.92% YTD), while hedge fund managers outperformed the index.

The Barclays Aggregate Bond Index increased +2.59% for the month (+9.11% YTD) as interest rates decreased for the month.

The Merrill Lynch High Yield Master II Index increased +5.09% for the month, and high yield spreads increased 20 basis points to end the month 413 basis points over treasuries.

Fixed income managers were positive for the month with the 10-Year U.S. Treasury ending the month at +1.50%, down 52 basis point from +2.02% in the previous month. WTI oil decreased by -5.91% in August while natural gas increased by +2.19%.