IMS Monthly Update

  • 1st June 2022

    It’s fair to say that markets have not been having the greatest time since the review went out, or indeed since the start of the year for that matter. The main US market, the S&P 500, managed to avoid an ignominious record in the final full week of the month with a (very) positive return helping it to miss out on 8 straight weeks of losses. This would have broken a record dating back before World War II and something that has only happened twice before.

  • 1st April 2022

    It has often been noted that during the pandemic, time appeared to move more quickly; two years passed in a flash. Despite this it does seem to have taken forever for the clocks to finally spring forward after what turned out to be a long and metaphorically dark winter. But they now have and as we enter the second quarter of the year, we can begin to enjoy lighter evenings and, hopefully, a broader sense of positivity as well.

  • 1st March 2022

    In light of recent events it is perhaps unsurprising that the bulk of this update centres on the situation on Europe’s eastern border. While there are other elements that are impacting on the medium term investment outlook, the situation in Ukraine is clearly the most relevant at this juncture. For the avoidance of doubt, this update is designed to cover the investment impact of Russia’s invasion of Ukraine and I’ll leave any commentary on the humanitarian impact to those better placed to comment.

  • 1st January 2022

    As ever, if you looked only at market performance, you could be forgiven for thinking that Covid had indeed ceased to be an issue. Most major indices were up over the month with the FTSE 100 reaching its highest point since the start of 2021 and several, including the S&P 500, finishing the year at record levels. Over the holiday period many markets enjoyed their traditional “Santa rally”, the period around Christmas where markets tend to enjoy a boost. Statistically it is the period during which the S&P 500 index is most likely to produce a positive return versus any other time of year.

  • 1st December 2021

    Following a fairly quiet few weeks where most of the focus was on when interest rates might rise, on the final Friday of the month the spectre of Covid made a dramatic return. Coronavirus infections have been rising in Europe recently and despite the reintroduction of some restrictions markets had seemed largely unconcerned. The change came when, in an act of perverse timing, Black Friday brought with it news that a new variant of Covid 19 had been found.

  • 1st October 2021

    At our recent investment committee meeting, I asked the speaker from Blackrock for his thoughts on the current state of markets in light of the potential headwinds we are monitoring. Primarily I was thinking about the impact of the tapering of the Fed’s asset purchase programme, but I also included the rapidly approaching debt ceiling deadline as well as the potential contagion effect of the Evergrande situation in China. It’s fair to say that I was more than a little surprised to hear that his view was that markets had already “priced in” the potential risks.

  • 1st September 2021

    One of the themes from the quarterly review centred on the sustainability of the market rally we’ve enjoyed since the second quarter of 2020. The recovery from the pandemic low point has been unusual both in how quickly it occurred and also in its scale. In some markets, such as the American S&P 500, it took just 6 months for share prices to bounce back while many of the main indices in the EU reached their previous highs after a year. In the UK, the FTSE 100 is not quite back to its former level, but as we’ve discussed before, there are other factors at play that have held back our recovery.

  • 1st July 2021

    The first half of a year that saw us take the first stuttering steps back to normality ended on a positive note with the new Health Secretary suggesting that Covid restrictions for England would come to an end later this month. And for those of a footballing persuasion, the good news kept on coming. However, while the pandemic remained a recurrent theme over the period, the dominant story from an investment perspective was the return of inflation.

  • 1st June 2021

    All of the IMS portfolios have a mandate that specifies a minimum and maximum level of equity which sets the tramlines between which we have to remain. Below this high level view there are a number of other constraints that detail the maximum and minimum weight we can allocate to a fund, how many sectors we must include, and so on. These mandates were set out when the portfolios were originally created and they form the framework around which we build our asset allocations and fund selections.

  • 1st April 2021

    March is typically a wet and pretty miserable month, and that felt especially the case as we began yet more weeks of lockdown, with our freedoms to travel and to socialise limited. However, towards its end we entered British summer time, with the clocks springing forward to give us an additional hour of evening light, many areas enjoyed record high temperatures, and, as we headed into the 4-day Easter bank holiday weekend, we passed the first stop on Boris Johnson’s roadmap for unwinding lockdown restrictions.

  • 1st March 2021

    This update was written on the anniversary of when Covid first started to impact on global markets. By the end of February 2020 the virus had been devastating China for over a month, but western economies had remained bizarrely aloof. That all changed when Italy became the first western country to shows signs that we might not be immune. It is often said that hindsight is 20-20 which seems to be a rather fitting saying given the lack of awareness or reaction from governments in the early part of that year.