Weekly Market View from Realm Investment Management. Week ending 29th July 2022.
Stock-markets were higher in a week when the International Monetary Fund (IMF) downgraded its global growth forecast. US Second-quarter earnings continue to roll out and Apple, Amazon and Alphabet posted better-than-expected results. More disappointingly, US GDP shrank by 0.9% on an annualised basis. This was the second consecutive quarter of contraction and technically puts the US economy in recession.
As expected, the US Federal Reserve raised short term interest rates on Wednesday by 0.75% with Chairman Jerome Powell surprising markets with the announcement that future policy will be determined on a meeting-by-meeting approach and be dependent on current data – in other words no more forward guidance from the Fed. Markets responded in a very positive fashion but this may well mean a further period of high volatility, especially if data does not match expectations.
Eurozone inflation reached a new record high but European equities were up last week helped by data showing that eurozone GDP increased by 0.7% in the second quarter, much better than expected.
U.S. Risk Barometer 29th July 2022
Europe Risk Barometer 29th July 2022
Disclaimer: ‘Where the business has expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. The information contained within this communication is believed to be reliable but Realm Investment Management Limited does not warrant its completeness or accuracy.
This communication is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell investments.’