Navigating rocky markets as 2022 starts with a whimper | February 2022 - a podcast by Smith & Williamson LLP

Markets have had a volatile start to the year, with particular weakness from the technology sector. The immediate catalyst appears to have been the hawkish minutes from the most recent FOMC meeting, which raised expectations of faster and steeper interest rate rises. Global equities have fallen around 4%.1

US equities have led the decline, with a significant sell-off in the 6 US mega caps, including Apple, Microsoft, Alphabet, Amazon, Tesla and Meta Platforms. Valuations had become stretched and the sector had looked ripe for a re-rating. Value markets, such as the UK, have fared better. 

While inflation, Covid variants and geopolitical tensions continue to weigh on investor sentiment, policy easing in China should improve global growth prospects and mitigate the impact of US rate rises. Inflation remains the key variable for the coming months. 

Source

1 Refinitiv, Smith and Williamson

 

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This episode was recorded on 31/01/2021

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