The second half of September saw headlines focusing once more on the economic and social costs of austerity, with protests on the streets of Athens and Madrid dominating news channels and share prices rolling back from recent highs.

However, it is indicative of the change in investors’ sentiment regarding Europe’s woes over the summer that it is now common to hear the opinion aired that a Spanish bail-out is inevitable, welcome and may actually provide a positive catalyst. Europe isn’t fixed yet, but it seems the negative story has eventually become exhausted.

Back in the UK, economically sensitive sectors did well in the first half of September but retrenched a little in the second. Forestry & paper, metals & mining and construction & building materials topped the leader board. Personal goods, tobacco, mobile telecoms and consumer goods were the four worst performers.

Recruiter shares have drifted down by around 3% over the past fortnight with Hays, Michael Page and SThree down by 6-9% and Manpower falling sharply by 10% in the US. Glancing back at last month’s City column, many stocks have given back most of the gains made when investors were excited by the European Central Bank president’s announcement of an “unlimited bond purchase programme”. However, Robert Walters has bucked the trend and its shares have appreciated by 5% over the past two weeks.

As we go to press, many of these companies are poised to update investors on third quarter trading trends. We know from comments made by Adecco at its recent analyst/investor day in Paris that European territories have experienced a traditional seasonal uplift in activity levels this autumn despite on-going macroeconomic uncertainty. The UK remains sluggish and, as we highlighted last month, many observers are nervous about trading momentum in Australia. The US is recovering but most of the UK companies we cover have limited activities there.

If any of you are hoping to sell your business to Adecco soon, then one additional comment made by the chief financial officer in Paris is worth bearing in mind – no significant acquisition activity will be considered over the next 18-24 months. Adecco will make exceptions, for example in emerging markets or niche specialist disciplines such as healthcare, but surplus cash is currently being used to buy back shares and pay a generous dividend to shareholders.