May proved to be a volatile month for markets, but after a tough first four months global equity and bond markets at least managed to end the period broadly flat. Recent concerns over global growth helped to slightly temper the extremely high interest rate expectations and provide support to markets, as did Federal Reserve Chairman Jerome Powell’s comments discounting the possibility of big (0.75%) rate hikes. Nonetheless, the market’s list of worries remained largely unchanged during the month: high inflation, tightening monetary policy, slowing growth, Russia’s invasion of Ukraine, and COVID-related lockdowns in China (albeit some of these restrictions were relaxed towards the end of the period). Overall, it would seem for sentiment to change markets we will need to see an improvement in several of these areas, especially inflation given its importance to the monetary policy outlook.
Global equity markets (-0.2%) were unchanged on the month. A large weighting to the energy sector continued to benefit UK equities (+1.3%), as it has done so far this year. In terms of style, growth stocks (-2.0%) yet again underperformed the more value / cyclically (+2.0%) orientated equities, on the back of valuation concerns and a number of disappointing quarterly earnings results. Sector performance was much less clear cut, while energy (+12.2%) was yet again easily the best performing area this was followed by utilities (+2.8%) and financials (+2.2%). At the other end of the spectrum, real estate (-3.8%), consumer staples (-3.4%) and consumer discretionary (-2.9%) sectors fell the most, reflecting in part lower demand and increasing pressure on margins of consumer facing companies.
Within fixed income markets, concerns over growth and a better understanding of the speed of US Federal Reserve interest rate rises, generated gains in the US bond markets during the month. Looking at the detail, global government bond prices fell (-0.5%) despite the rally in US bonds, as UK and European bond yields rose sharply due to inflation concerns. Global investment grade credit (+0.2%) generated a positive return over the month as spreads tightened marginally, at the riskier end of the credit spectrum the opposite was true with global high yield (-0.3%) posting a small decline.
In terms of real assets, property markets underperformed equities over the month with the global REITs index down -4.3% over the period. Commodities (+1.5%) rose for yet another month (+32.7% year to date), led primarily by crude oil (+11.5%) as a result of continued supply concerns due to the war between Russia and Ukraine. Industrial metals (-6.5%) fell further on the back of global demand concerns, while gold (-3.6%) was also weak despite a weaker US dollar during the month.
INDEX | END APRIL VALUE | END MAY VALUE |
FTSE 100 | 7544.55 | 7607.66 |
DJ Ind. Average | 32977.21 | 32990.12 |
S&P Composite | 4131.93 | 4132.15 |
Nasdaq 100 | 12854.8 | 12642.1 |
Nikkei | 26847.9 | 27279.8 |
£/$ | 1.2574 | 1.2602 |
€/£ | 0.83878 | 0.8518 |
€/$ | 1.0545 | 1.0734 |
£ Base Rate | 0.75 | 1 |
Brent Crude | 107.14 | 115.6 |
Gold | 1896.93 | 1837.35 |
This month’s values quoted as at 31/05/2022. The above values are sourced from Bloomberg and are quoted in the relevant currency.
We regularly publish articles, as well as host webinars, to explain what’s happening in financial markets or how you can manage your wealth. Just submit your email address to receive the updates in your inbox.
Clients of Nedbank Private Wealth can get in touch with their private bankers directly to understand how their portfolios are responding to market events or call +44 (0)1624 645000 and speak to our client services team.
If you would like to find out more about how we help manage clients’ investments, please also contact us on the number above. Or you can get in touch using the links to the forms towards the end of this page.
Investments can go down, as well as up, to the extent that you might get back less than the total you originally invested. Exchange rates also impact the value of your investments. Past performance is no guide to future returns. Any individual investment or security mentioned here may not be suitable, and is included for information only and is not a recommendation. You should always seek professional advice before making any investment decisions.
Tom was appointed in March 2021 and brings to the table over 20 years’ investment experience. Prior to joining, he was at Santander Asset Management in London for nine years, where he was, most recently, the chief investment officer for its UK business, having previously been the global head of the multi asset division. Tom also spent several years as head of multi manager and fund selection at LV Asset Management.
Tom sits within Nedgroup Investments, a sister company, which provides investment advice, research and portfolio modelling solutions to Nedbank Private Wealth. Here, he heads up the London-based investment team. It is in this capacity that he is a member of Nedbank Private Wealth’s investment committee.
Tom was appointed in March 2021 and brings to the table over 20 years’ investment experience. Prior to joining, he was at Santander Asset Management in London for nine years, where he was, most recently, the chief investment officer for its UK business, having previously been the global head of the multi asset division. Tom also spent several years as head of multi manager and fund selection at LV Asset Management.
Tom sits within Nedgroup Investments, a sister company, which provides investment advice, research and portfolio modelling solutions to Nedbank Private Wealth. Here, he heads up the London-based investment team. It is in this capacity that he is a member of Nedbank Private Wealth’s investment committee.
+44 (0)20 7002 3498
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.
Copyright Nedbank Limited 2023.
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
This is the Nedbank Private Wealth International website. You can access Nedbank Private Wealth South Africa by clicking on the link or using the toggle in the header.
This website is accessible worldwide. We cannot guarantee that the website or the information contained within it complies with, or is appropriate for use in, all jurisdictions. The purpose of this website is to provide information about Nedbank Private Wealth, our products and services, and how we aim to help our clients. Not all products and services referred to in this website are available in all jurisdictions. The information contained in the website is not intended to, and does not constitute, any offer by us to sell, nor it is intended to be an invitation or solicitation to buy, any product or service, and must not be relied on in connection with any investment or other decision. More information is available in the legal notices section of this website. This message will only be displayed once.
This website uses cookies to improve your experience on our website. We recently updated our privacy policy and our cookies policy to ensure you understand how we protect your personal information. Please note that in order to stop cookies being downloaded, you will need to change your browser settings, which we explain in our cookies policy.