Category: Market Update
Market Update: The state of the global economy
By most measures, economic growth has been disappointing over the last few months. Economists started the year with high expectations for the post-pandemic recovery to become a sustained expansion – optimistic that vaccines and rebounding confidence would spur activity.
Market Update: Economy Hits an Air Pocket
October has carried on where September left off, with quite a bit of daily up and down for markets, but with a slight downwards trend. For UK readers, the lack of positive vibe in stock markets is probably unsurprising, with petrol this week only slowly returning to being a commodity – rather than a scarcity...
Market Update: Wall of Worry Time
The UK received worrying economic news on multiple fronts this week, with several utility companies going under and the prospect of steep rises in winter heating costs, petrol stations running out of fuel, gaps on supermarket shelves and the Bank of England signalling it may raise rates as early as December of this year.
Market Update: End of the re-opening honeymoon
We are halfway through September and investors have not experienced a continuation of the positive returns picture of the summer months. This is despite COVID restrictions gradually lifting (not only in the UK) and an on-track economic recovery resulting in record numbers of jobs and demand outstripping supply in many places.
Market Update: Paying For It
Last week, we noted the increasing importance of fiscal policy, and sure enough this week the UK kicked-off the new school year with a big fiscal bang. National Insurance contributions are on the rise, along with a further tax charge on dividends to fund the NHS and social care over the next few years.
Market Update: Politics and policy sit at the head of the table
Last week felt a bit like the whole month of August. Equity markets (North America and Europe) were in the green over the past few days, and then on Friday expressed their disappointment over the weak US jobs report. Market participants discovered yet again their taste for cash-rich mega- caps in the US, especially after last week’s Jackson Hole symposium.
Market Update: Fed tapering: the ‘how’ matters more than ‘when’
Questions over when and how the US Federal Reserve (Fed) would begin tapering its monthly securities purchases has been much talked about over the last few months. But ahead of Friday's keynote speech at the Jackson Hole symposium, questions have been shifting increasingly towards ‘how’ the Fed tapers, instead of ‘when’. On Friday we got an answer, of sorts.
Market Update: Markets hit a bit of to and fro
Investors would be forgiven to think that this week’s downdraft in global stock markets was in reaction to the rapid unfolding of the tragic events in Kabul, Afghanistan. However, as long-time observers of risk asset markets will attest, unless human tragedies are likely to have a discernible impact on the global economy, stock markets do not show any empathy to present or foreseeable human suffering.
Market Update: Climbing the wall of worry – again
August continues to be what one would expect from the middle of the summer: quiet. Yet for investors, it is also pleasing that stock markets around the world are gradually nudging upwards, allowing them to remain relaxed wherever they have retreated to in these travel restricted times.
Market Update: Between policy support withdrawal and bounce-back upsurge
Three weeks since the long-awaited “Freedom Day”, Britons are enjoying a pleasant, if somewhat overcast and dull, summer. The surprise drop-off in virus cases seems to have levelled off, but while the fact that numbers are not increasing is an encouraging sign, it remains to be seen whether this will be sustained.
Market Update: Summer lull as markets go through the motions
We wrote last week, that fortunes could be changing on the COVID front, with UK case numbers showing a decline from their (possibly temporary) peak. Since then, the 7-day average for daily cases has fallen for the first time since Britain started reopening. It is far too early to say whether this marks a sustained turn for the better, but it has certainly brought some much-needed optimism. The good mood has spread to markets too, with UK assets outperforming global peers and sterling gaining against other currencies.
Market Update: Markets wake up to living with the virus
It has been a week of ups and downs. Monday saw sunshine and relaxation as so-called ‘Freedom Day’ COVID restrictions were lifted in England. Investors did not join in the party, though, as major equity indices sold off around the world. Markets recovered most of those losses later into the week, but the episode marked an unwelcome return of volatility. Unfortunately, that market volatility has been matched by uncertainty in the underlying economy, as the spread of the virus continues to pose a threat to global activity.
Market Update: How negative are yields?
Investors chase returns. That statement may seem too obvious to be interesting, but over the last decade it has had a special significance. For a year and a half now, central banks around the world have pinned interest rates down and poured historic amounts of liquidity into the global financial system. But the era of loose monetary policy long predates the pandemic
Market Update: Don’t Look Down
Global equities have been on a pretty rapid ascent since the start of the year. This week the world’s investors had a bout of looking down, and a mild attack of vertigo. This dizzyness has been prompted by some reasonable worries. Do we have enough food (earnings growth) to carry on? Is the strong tailwind (in the form of liquidity) about to turn into a headwind? Has one of our party (China) already started slipping back down?
Market Update: Transition Uncertainties
The great British summer may have struggled to materialise so far, but the end of the first half of the year always brings an element of sunny optimism. We will comment on market and investment returns in more detail next week, when the data has settled, but after what proved a quite decent 2020 for investors, the first half of 2021 has again left investors with plenty to be positive about.
Market Update: Moderating Expectations…
The seemingly never-ending pandemic-induced restrictions and uncertainty is making the forward planning of summer activities quite precarious and frustrating at times. That capital markets have recently borne fewer surprises than the planning of our summer holidays is a rare event and should be cherished – assuming it is not simply the calm before the next storm.
Market Update: Investors try to make sense of the Fed’s ‘dot-plot’
The biggest event of the week took place on Wednesday, as the US Federal Reserve (Fed) concluded its two-day Federal Open Markets Committee (FOMC) meeting, where it discussed economy policy and its latest projections on inflation and interest rates. Leading up to Wednesday, we were asking ourselves the question “what will the Fed change?”. In essence the choices were “nothing”, “a bit”, or “more than a bit”. All of us were somewhere between “nothing” and “a bit”. The Fed delivered “a bit”.
Market Update: Hazy as Carbis Bay
The G7 meeting in St. Ives’ Carbis Bay was rightly the centre of attention in the UK this week and looks to centre on Europe’s leaders cosying up to a much more loveable US administration, at the same time as trying not to mention Brexit too much.
Market Update: Going up Sideways
May’s returns numbers are in, and the headlines are as follows: a rotation from tech to financials – and from value to growth – as well as a bit more downward pressure on bonds. We have included our usual ‘in review’ table and monthly comments below. Overall, it was a quiet month...
Market Update: Touch of Goldilocks at the end of May
After a strong April, May felt somewhat of a mixed bag for investors, particularly when stock markets suffered a correction in the middle of the month. However, as the month draws to a close, it is mostly only cryptocurrency holders and those who had banked on a warm and sunny May in Northern Europe who are still feeling the pain.