January market update – a volatile start to the year

Global equity markets started 2018 in the same positive fashion that they ended 2017, with the US market notably strong. However, late January saw a spike in volatility and a fall in equity markets, as European and US bond yields rose to multi-year highs.

What happened in the markets?

• The movements were largely a result of inflationary concerns and increased investor speculation that global Central banks were set to tighten their monetary policies further, as the global economy continued to strengthen and equity market exuberance reached fresh highs

• Despite these late movements, US and European equities produced positive returns for investors in January
• There were also positive returns from Asian and Emerging Market equities, which were supported by another weak month for the US dollar and a solid month for commodity markets. However, UK equities faced headwinds from a stronger pound

Read our market commentary

We hope you have found this update helpful. Please do get in touch on 020 7189 2400or email contact@tilney.co.uk if you have any queries or would like more information.