The week in review

The week of 13 February 2023 saw a fresh twist in the market narrative, as investors realised that high interest rates will be an unwelcome presence for longer than expected.
Published 21 February
4 mins

What’s happened in markets?

FTSE All Share1.471.958.857.487.415.095.38
Euro Stoxx 501.852.6010.9713.037.776.597.90
S&P 500-0.202.383.806.48-5.318.1610.25
Japan Topix0.254.691.495.315.938.245.24
MSCI Asia Pac.-2.13-2.797.734.62-15.600.140.17
MSCI Emerg. Mkts.-1.38-2.676.594.59-16.93-0.73-0.89
Jo’burg All Shares0.36-0.0910.168.619.2515.2910.04
UK Gov’t Bonds-1.07-1.96-3.860.68-19.15-8.39-2.78
US Gov’t Bonds-0.39-1.530.980.60-8.93-3.100.46
Global Corp. Bonds-0.60-1.252.481.77-8.17-2.781.25
Emerg. Mkt. Local-1.42-2.286.661.86-9.43-4.12-1.73
Figures in the respective local currencies as at the end of trading on 17/2/2023.

The previous week’s strong US jobs report was followed this week by a higher-than-expected signal of inflation. The headline producer price index (PPI) rose by 6% year on year, against a forecast 5.4%. This prompted a revision of expectations among investors, who now anticipate interest rates will remain higher for a longer period: a peak of 5.5% in September is widely predicted.

The UK registered a slight inflation dip, though at 10.1% the consumer price index (CPI) remains high.

The week marked the first anniversary of the Russian invasion of Ukraine, whose impact continues to dominate the global economy. Meanwhile, US-China tensions simmered over suggestions that China might supply weapons to Russia, as well as the ongoing issue of surveillance balloons. UK politics was dominated by the surprise resignation of Scottish First Minister, Nicola Sturgeon, and efforts by Prime Minister Rishi Sunak to strike a deal on post-Brexit trading rules for Northern Ireland.

In the corporate world, Coca-Cola and Pepsi both announced earnings that outstripped expectations. In each case price growth was the driver. However, Nestlé has not enjoyed the same success: its 2022 earnings fell short of expectations, despite price hikes of 8.2%. The company plans to raise prices further this year.

The coming week will bring updates from top commodity firms, including Rio Tinto and Anglo American; US retail giants Walmart and Home Depot; and two of China’s dominant businesses, Baidu and Alibaba.

The strong inflation data and the Federal Reserve’s shift back to more hawkish rhetoric led to an equities sell-off. IT performed best over 30 days (+7%), with energy the worst-performing sector (-3%). Developed markets (+3%) continued to outperform developing markets (-3%), while growth stocks (+3%) did better than value (+1%). Large and small capitalisation stocks each grew by 2%.

Fixed income yields benefited in this environment, with the 10-year rate up by nearly 47 base points over the past two weeks, at 3.8%.

The US Dollar appreciated slightly against most major currencies.




UK GDP (QoQ)0.0
UK PMI48.548.7
UK CPI (YoY)10.510.3
EU GDP (QoQ)0.10.1
EU PMI50.350.6
EU CPI (YoY)9.28.6
US GDP (QoQ)2.92.9
US PMI55.2
US CPI (YoY)6.56.2

What’s happened in portfolios?

Our positioning on equities remains focused on quality. The stock selections of Fundsmith and Nedgroup Global Equity have impressed, particularly in communications and healthcare. Both funds hold stocks in Meta, whose last earnings report exceeded expectations and which sees big opportunities in messaging and AI applications.

Fixed income has been more attractive, though the current environment is less supportive of credit. Our longer-duration funds within investment grade credit and government bonds have lagged short-dated ones.

Among real assets, UK-focused investment trusts performed well on the back of better-than-expected UK inflation indicators, and the prospect that the Bank of England might temper rate hikes as a result.

Alternative strategies remain valuable for diversification. This week Gore Street Energy Storage Fund has announced its purchase of a 200MW energy storage project in the US for $110m, which will bring its international capacity to 1,173MW.

What's happening this week?

21 February • UK Purchasing Managers’ Index | 23 February • EU Consumer Price Index | 23 February • US Initial Jobless Claims

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 and (1) Bloomberg, (2) Reuters and (3) Financial Times

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


The week in review

21 Mar

   |   4 mins

The week of 13 March 2023 was another volatile week for markets as further upheaval in the banking sector raised fears of a steeper economic slowdown and hopes of an easing of central bank rate hikes.


The week in review

14 Mar

   |   4 mins

The week of 6 March 2023 saw markets down sharply, as hawkish talk from the Federal Reserve and strong US jobs data early in the week were eclipsed by events in the financial sector.


February's investment market commentary

10 Mar

   |   2½ mins

February saw a reversal of some of the strong gains made in the prior month, with both global equity and bond markets falling during the period. Simon Watts explains.


The week in review

28 Feb

   |   3 mins

The week of 20 February 2023 saw stronger than expected inflation and economic growth reports and a more hawkish stance from central banks, leading to widespread declines in markets.

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