The week in review

January 2022 ended with record levels of inflation, rising interest rates and an increasingly hawkish outlook on future monetary policy.
Published 8 February
3 1⁄2 mins

What’s happened in markets?

FTSE All Share0.63-1.521.590.0717.276.585.22
Euro Stoxx 50-1.22-6.35-5.46-4.7914.9412.067.83
S&P 5001.57-6.02-3.50-5.4717.8820.2416.48
Japan Topix2.86-4.90-5.95-3.095.729.407.36
MSCI Asia Pac.2.91-1.72-4.05-1.52-13.649.169.79
MSCI Emerg. Mkts.2.52-1.08-3.38-0.85-9.977.958.63
Jo’burg All Shares2.380.2610.632.0822.8916.0611.20
UK Gov’t Bonds-1.61-3.41-4.39-4.47-6.461.421.75
US Gov’t Bonds-0.97-1.80-2.76-2.78-3.713.092.49
Global Corp. Bonds-1.35-3.04-4.09-3.83-3.614.513.98
Emerg. Mkt. Local1.220.74-0.210.17-6.161.412.86

Figures in the respective local currencies as at the end of trading on 4/02/2022.

The US Labor Department released its latest monthly jobs report on Friday 4 February, revealing the US economy created far more jobs than expected in January, even as Omicron cases peaked at the beginning of the year. Nonfarm payrolls surged by 467,000 for the month, while unemployment edged higher to 4%. The Dow Jones estimate was for payroll growth of 150,000 and a 3.9% unemployment rate.

The eurozone’s unemployment rate also fell to a historic 6.4% low in December, as hiring in Europe showed a solid recovery despite the spread of the Omicron variant, according to official figures from Eurostat released on Tuesday 1 February.

The eurozone economy grew 0.3% in the final three months of 2021, returning the bloc to pre-pandemic levels. Eurostat’s first estimate of full-year gross domestic product showed growth of 5.2% – the region’s fastest expansion since 1971.
Inflation also accelerated to a new record of 5.1%, defying expectations of a slowdown and adding pressure on the European Central Bank (ECB) to respond with tighter monetary policy. The spike in inflation prompted a shift in rhetoric from ECB president Christine Lagarde, who was no longer willing to affirm that an interest rate hike this year is “very unlikely” after the ECB’s policy meeting on Thursday 3 February.
The Bank of England also took a hawkish turn to contain inflation, increasing the key interest rate by 0.25% to 0.5%, the first time since 2004 that it has implemented consecutive rate hikes. Of the nine members of the monetary policy committee, five voted for an increase of 0.25% while the other four wanted a steeper hike of 0.5%, affirming the market’s pricing for five more rate hikes this year.
Elsewhere, shares of Facebook parent Meta Platforms Inc. plummeted on Thursday 3 February, losing over a quarter of its value (almost US$240 billion) after the company fell short with its quarterly outlook. Meta reported a list of business pressures, from its first-ever decline in daily active users, to the rise of TikTok and economic constraints on advertising spend.
OPEC+, an influential group of some of the world’s largest oil producers, agreed to boost its production quota for the eighth consecutive month on Wednesday 2 February, aiming to raise production by another 400,000 barrels a day in March.
However, despite huge pressure from major energy consuming nations to control the high energy prices that are fuelling global inflation, OPEC+ undershot its output quota in January. According to data compiled by Reuters, the group has repeatedly failed to meet its monthly target of adding back 400,000 barrels per day, due to production shortfalls in several countries.



UK GDP (QoQ)1.11.1
UK PMI54.2
UK CPI (YoY)5.4
EU GDP (QoQ)0.3
EU PMI52.3
EU CPI (YoY)5.1
US GDP (QoQ)6.9
US PMI59.9
US CPI (YoY)7.07.3

What’s happened in portfolios?

Developed market equities ended January down (-4.4%) as growth stocks (-6.4%) came under pressure, with a few big names weighing down the index last week (particularly in sectors that had benefited from changing consumer patterns during the pandemic, where revenue growth is unlikely to be repeated in the future).
Energy (+11.8%) and financials (+1.3%) were the only sectors in the green, but value (-1.4%) in general outperformed growth (-6.4%) over the last 30 days, with materials and utilities posting low single digit losses.
Oil (+19.2%) continued to increase in value due to current tensions between Russia and Ukraine and supply side issues, while fixed income continues to come under pressure on the back of rising yields.
Looking across our portfolio, we continue to see a favourable environment for equities but do expect to see a volatile year. We maintain our preference for domestic developed markets – specifically pan-Europe where economies are reopening and valuations are not stretched on a relative basis.
We see a less favourable environment for fixed income assets, where starting yields are at historically low levels and inflation continues to pose a threat to mid- to longer-duration positioning.
Real assets present an attractive alternative to fixed income, with some inflation protection. Infrastructure is of particular interest given valuations and recovery potential.
Alternative strategies are also preferable in the current environment to provide a credible diversifier within portfolios, with private equity of particular interest to tap into the re-opening of economies.

What's happening this week?

10 Feb • US Consumer Price Index (January) | 10 Feb • US Initial Jobless Claims | 11 Feb • UK Gross Domestic Product (December)

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) US Department of Labor, (4) Eurostat and (5) OPEC.

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

23 May

   |   4 mins

During the week of 15 May 2023, investor sentiment was buoyed by a more positive tone in the US debt ceiling negotiations. But continued tightness in labour markets prompted more hawkish comments from central banks on their determination to reduce inflation.


The week in review

16 May

   |   4 mins

The week of 8 May 2023 was a mixed week for markets. US equities and bonds advanced as investor confidence grew following better than expected inflation data. However, weaker data releases renewed fears of a slowdown and led to a risk-off sentiment.


April's investment market commentary

12 May

   |   3 mins

April was a quieter month for markets as attention focused on further rate increases, given stronger economic data and signs of more persistent inflation. Simon Watts explains.


Quarterly Investment Report

28 Apr

   |   60 mins

During the programme, we covered an overview of the markets and how we are managing our clients' investments, how we help our clients fulfil their borrowing needs, and how to avoid emotions getting in the way of your plans.

Get in touch

If you are interested in becoming a client, please complete the form via the ‘become a client’ button below. Alternatively, if you are already a client, or if you have a question about how we help clients in particular circumstances, please use the ‘contact us’ button.


We will get back to you as soon as we can during office hours, which are Monday to Friday, 8am to 8pm (UK time), except for UK public holidays.

Become a Client

Thank you for your interest in Nedbank Private Wealth. Please call us on +44 (0)1624 645000 or complete the requested information and one of our team will get back to you soon. We look forward to speaking with you.  Please note: If you are an EU resident, we are unfortunately unable to offer our services to you at present.

* Required fields

Contact Us

Please call us today on +44 (0)1624 645000. Our office hours are weekdays from 8am to 8pm (UK time), except for UK public holidays.


Or please complete and submit the below form and one of the team will get back to you as requested.

* Required fields

Search suggestions