The week in review

Financial markets were wrong footed on several fronts as the week of 11 July 2022 sprang a series of surprises in the form of economic indicators and central bank moves.
Published 19 July
2½ mins

What’s happened in markets?

FTSE All Share-0.51-1.62-6.14-4.531.822.003.16
Euro Stoxx 50-0.84-1.42-7.54-16.79-11.312.652.91
S&P 500-0.912.05-11.69-18.27-10.1110.4211.40
Japan Topix0.272.11-0.06-3.70-0.088.795.49
MSCI Asia Pac.-3.65-3.82-9.48-19.03-
MSCI Emerg. Mkts.-3.68-4.93-12.41-20.45-26.47-0.520.99
Jo’burg All Shares-4.73-3.42-10.96-9.611.248.157.69
UK Gov’t Bonds0.341.03-4.63-13.87-14.17-3.64-0.60
US Gov’t Bonds0.842.03-1.04-8.88-9.50-0.630.81
Global Corp. Bonds0.851.78-2.95-11.95-12.52-0.701.50
Emerg. Mkt. Local-1.16-1.94-9.12-14.99-18.26-5.40-1.84
Figures in the respective local currencies as at the end of trading on 15/07/2022.

In a week that ended in negative territory for most equity markets, news headlines highlighted some surprising data that caught out many economic expectations.

Price rises in the US outstripped predictions once again in the week of 11 July. The headline consumer price index (CPI), a key inflation indicator, jumped to 9.1%, much higher than the 8.8% predicted by economists. Meanwhile, new claims for unemployment benefit hit the highest level since November, 244,000, suggesting a slight cooling in the US labour market.

There was a surprise for UK observers too. Gross domestic product (GDP) for May had been expected to remain more or less static to the April decline of 0.2% but, in the event, grew by 0.5%, driven partly by holiday travel and “a large rise in GP (doctors) appointments”.

The Bank of Canada announced an unexpectedly aggressive interest rate rise of 1% to 2.5%, citing high and persistent inflation.

Speculation about a similarly robust Federal Reserve (Fed) response to US inflation was heightened by comments such as those of Atlanta Federal Reserve Bank President Raphael Bostic, who declared: “Everything is in play”.

The next Fed move will not come until July 26/27. Meanwhile, the European Central Bank is likely to deliver its first interest rate rise since 2011 in the coming week: a 0.25% interest rate hike is expected. The Bank of Japan will also meet to consider its rates’ policy this week.

The markets have seen slightly less turmoil over the past 30 days, with growth stocks outperforming (+1.9%); value (-2.9%) and small capitalisation (-2%) stocks declining; and large capitailsation equities (-0.3%) only slightly negative. Developed markets were static (-0.1%) while emerging markets fell in value (-4.4%).

In sector terms, healthcare (+5.6%) is the best 30-day performer and energy (-17.2%) the worst, due to the weakening of the oil price following the huge gains of the previous six months. With the exception of European gas, other commodities have also been trending down, with gold at -5.8%, for example.

The US dollar remains strong against the other major currencies: the past week saw the euro and US dollar trading at parity for the first time in 20 years.




UK GDP (QoQ)0.8
UK PMI53.752.5
UK CPI (YoY)9.19.2
EU GDP (QoQ)0.6
EU PMI52.051.0
EU CPI (YoY)8.68.6
US GDP (QoQ)-1.60.9
US PMI55.3
US CPI (YoY)9.1

What’s happened in portfolios?

Recessionary fears mean value equities are lagging peers categarised as quality over the short term. This makes it a good time to tilt to our quality-focused strategies.

The significant upward shift in yields (global government bonds +2.4% over 30 days, investment grade +2.3%) has also made fixed income more attractive. As such, we have reduced our overweight to high yield and see this as a good time to gradually increase duration, which has been rewarding investors over recent weeks.

In real assets, renewables have shown a slight weakness recently due to the oil price decline, but year-on-year gains remain high.

In alternative strategies, strong streaming growth helped lift Hipgnosis to a remarkable performance: it announced net asset value (NAV) return of 9.9%, or 14.2% including dividends.

What's happening this week?

21 July • EU ECB Interest Rate Decision | 21 July • US Initial Jobless Claims | 22 July • UK Retail Sales (June)

Clients of Nedbank Private Wealth can get in touch with their private banker directly to understand how their portfolios are responding to market events, or call +44 (0)1624 645000 to speak to our client services team.


If you would like to find out more about how we manage clients’ investments, please contact us on the same number as above. Or you can get in touch using the links to the forms towards the end of this page.

Sources: Nedbank Private Wealth; Bloomberg; Reuters; Financial Times; Quoted Data and UK Government

The value of investments can fall, as well as rise, and you might not get back the original amount invested. Exchange rate changes affect the value of investments. Past performance is not necessarily a guide to future returns. Any individual investment or security mentioned may be included in clients’ portfolios and is referenced for illustrative purposes only, not as a recommendation, not least as it may not be suitable. You should always seek professional advice before making any investment decisions.

Access more of our insights


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Following a challenging first half of 2022, global equity and bond markets rallied strongly during July. Risk assets were supported by concerns over global economic growth and recessionary fears, which tempered higher interest rate expectations.


The week in review

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Recession – what recession? The week of 25 July 2022 saw strong rallies across most markets, in response to hints that the Federal Reserve might ease up on its rate hike programme.


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27 Jul

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The week of 18 July saw no let-up in market volatility. Economic indicators came in below expectations, as high inflation and steepening borrowing costs continued to fuel recessionary fears.


June's investment market commentary

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   |   3¾ mins

June was a challenging month as many of the weakness seen in earlier months continued to affect markets, however there are signs that inflation may be coming under control once again.

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