Monthly markets review - May 2016
A look back at markets in May 2016 when stronger US macroeconomic data fuelled expectations of a summer rate hike from the Federal Reserve.
- Equities and most bond markets gained in May as investors continued to speculate about the timing of the next US interest rate rise. Oil prices gained with Brent rising to $50 per barrel during the month.
- US equities advanced against a backdrop of improving macroeconomic data. This included an acceleration in inflation which helped fuel expectations of a summer rate rise, in turn supporting a dollar rally.
- Eurozone equities posted positive returns, helped by a weaker euro. Receding Brexit worries supported gains for UK equities.
- Japanese equities gained ground and the yen weakened. The debate over the next planned rise in the consumption tax continued, although economic data was largely positive.
- Emerging markets posted negative returns. Brazil and Turkey were key laggards, while China outperformed despite some disappointing macroeconomic data and concerns about capital outflows.
- Treasuries were the only major sovereign bonds to see rising yields in May. Investment grade credit broadly underperformed government bonds.
This communication is marketing material. The views and opinions contained herein are those of the named author(s) on this page, and may not necessarily represent views expressed or reflected in other Schroders communications, strategies or funds.
This document is intended to be for information purposes only and it is not intended as promotional material in any respect. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The material is not intended to provide, and should not be relied on for, accounting, legal or tax advice, or investment recommendations. Information herein is believed to be reliable but Schroder Investment Management Ltd (Schroders) does not warrant its completeness or accuracy.
The data has been sourced by Schroders and should be independently verified before further publication or use. No responsibility can be accepted for error of fact or opinion. This does not exclude or restrict any duty or liability that Schroders has to its customers under the Financial Services and Markets Act 2000 (as amended from time to time) or any other regulatory system. Reliance should not be placed on the views and information in the document when taking individual investment and/or strategic decisions.
Past Performance is not a guide to future performance. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. Exchange rate changes may cause the value of any overseas investments to rise or fall.
Any sectors, securities, regions or countries shown above are for illustrative purposes only and are not to be considered a recommendation to buy or sell.
The forecasts included should not be relied upon, are not guaranteed and are provided only as at the date of issue. Our forecasts are based on our own assumptions which may change. Forecasts and assumptions may be affected by external economic or other factors.
Issued by Schroder Unit Trusts Limited, 1 London Wall Place, London EC2Y 5AU. Registered Number 4191730 England. Authorised and regulated by the Financial Conduct Authority.