The week in review

Shocking developments in Europe transfixed the world and continued to rock global markets during the week of 28 February 2022.
Published 7 March
3 mins

What’s happened in markets?

FTSE All Share-6.75-7.34-3.79-7.275.653.122.97
Euro Stoxx 50-10.42-12.86-12.60-17.04-1.605.374.08
S&P 500-1.24-3.67-4.30-8.9416.4717.6914.72
Japan Topix-1.67-4.41-5.60-7.36-0.016.735.80
MSCI Asia Pac.-2.74-6.80-7.72-8.22-17.045.677.85
MSCI Emerg. Mkts.-2.29-6.18-6.15-6.97-12.925.486.97
Jo’burg All Shares0.720.146.522.2315.4314.1411.47
UK Gov’t Bonds2.321.26-6.11-3.27-2.211.811.56
US Gov’t Bonds1.180.58-3.10-2.21-0.973.252.61
Global Corp. Bonds0.83-0.70-5.03-4.51-2.484.013.69
Emerg. Mkt. Local-2.80-3.81-2.63-3.64-7.240.482.04
Figures in the respective local currencies as at the end of trading on 04/03/2022.

Even as the intensifying conflict in Ukraine alarmed the world – and shook markets – key economic indicators remained robust. In particular, global purchasing managers’ indices, one of those forward looking indicators, came in stronger than anticipated during the week of 28 February.

Unemployment in the euro area dropped to 6.8%, down from 8.3% a year earlier, and the lowest level since the single currency was formed. Meanwhile, rising energy prices lifted annual inflation to 5.8% in February, according to the flash consumer price index, slightly above the 5.6% expected. The European Central Bank is expected to remain cautious at its monetary policy meeting this month. While policymakers’ current priority may be to support their economies amid global crisis, this is likely to affect only the timing of interest rate rises to control inflation, rather than the overall trajectory.

The US labour market was robust too, with unemployment falling further to a two-year low of 3.8%, comfortably below the 4.0% level seen as full employment. Mounting anticipation of a 50 basis-point rise in US interest rates was doused by Federal Reserve chair Jerome Powell, who said he favoured a 25 basis-point rise this month.

The intensity of the Russian advance into Ukraine, including the unexpected attack on Europe’s biggest nuclear power station, dominated the political scene.

Sanctions, including the removal of Russian banks from the Swift international payment system, are already diminishing Russia’s economy: the rouble has lost 30% of its value against the US dollar, while the country’s gross domestic product has shrunk to 4.9%, lower than that of Mexico. International sanctions against Russian oil and gas would further devastate the Russian economy – the prospect has already caused oil prices to spike above US$130 a barrel – but such a move is complicated by European dependence on these supplies.

Piling on the pressure further, Moody’s and Fitch downgraded Russia’s sovereign debt to junk status. While MSCI removed Russia from its emerging markets equity indices, declaring the country’s equity markets “uninvestable”. The Russian stock market remains closed since Monday 28 February.

At a corporate level, Accenture and McKinsey joined the long list of businesses to have suspended Russian operations, as did three of the ‘Big Four’ accountants – PwC, KPMG and EY.

These seismic events were reflected in the performance of risk assets. Stocks fell in both developed (-7%) and emerging markets (-6%). Growth stocks again suffered most (-9%), but value stocks dropped too (-5%). Large capitalisation stocks (-7%) fared slightly worse than small capitalisation stocks (-5%). In sectoral terms, energy was the only sector in positive territory (+2%), while communications services was the worst performer (-12%).

An inevitable dash for safe-haven assets caused sovereign bonds to rally. The same trend strengthened the US dollar, which rose 3.4% against the euro and 2.6% against sterling. Commodities were unsurprisingly strong, with oil the biggest story (+31%). The price of gold (+9%) surged to its highest in more than a year.




UK GDP (QoQ)1.0
UK PMI59.9
UK CPI (YoY)5.5
EU GDP (QoQ)0.30.3
EU PMI55.5
EU CPI (YoY)5.8
US GDP (QoQ)7.0
US PMI56.5
US CPI (YoY)7.57.9

What’s happened in portfolios?

Despite global volatility, the market remains favourable for equities in domestic developed markets. Given the conflict in Europe, we have moderated our position slightly in favour of US stocks rather than European equities.

Starting yields for fixed income are historically low, and inflation is a threat to longer duration. However, our short duration, high yield holdings, such as Axa Investment Managers and Muzinich & Co, have been performing well.

Among real assets, Greencoat UK Wind is benefiting from high energy prices as well as recent extra-high wind speeds, boosting earnings and net asset value (NAV) growth. The Renewables Infrastructure Group (TRIG) is also benefiting, although it is more diversified in areas such as battery storage, offering future promise.

We see private equity as particularly interesting to tap into the reopening of economies. Market volatility forced Princess Private Equity to shelve a planned initial public offering of the KinderCare nursery provider in the US; this stalled NAV growth, but we expect the move to go ahead in the future.

What's happening this week?

8 Mar • EU Gross Domestic Product Growth Rate | 10 Mar • US Consumer Price Index | 11 Mar • UK Gross Domestic Product

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, (3) Eurostat and (4) CNBC.

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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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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