Monthly Review - December 2012
Investment Comment & Outlook
Strong liquidity conditions as well as reasonable valuations (especially relative to other assets) support equities, although debt overhang risks remain. Bond yields to remain low for some time.Equity Markets
• Equity markets picked up again in November following a slight retracement the previous month. Markets were generally supported by further optimism concerning the eurozone debt crisis.
• World equities (in euro terms) rose by 1% in November, leaving the total return for the first eleven months of 2012 at 14%, with this index just under 3% off its all-time high.•Bond & Interest Rates
• The Merrill Lynch Euro over 5 Year Index rose by a further 2% in November, giving a rise of 14% for the first eleven months of the year (coincidentally the same as world equities).• Peripheral markets outperformed the core. Spanish and Italian prices rose by between 3% and 4%, while Germany rose 1%. The longer-term trend of the core outperforming the periphery has broken down significantly in the last four months.
Commodities & Currencies
• The CRB Index rose by 1% in November following a sharp fall the previous month.
• Brent oil (European) ended November up 2%, at $111 per barrel, while West Texas (US) rose 3% to $89 per barrel
• After a good run during the autumn, the gold price fell back again to $1,711 per troy ounce. Gold reached an all time high of €1,889 in August 2011.
• Following a three month strengthening, the euro was flat against most major currencies (with the exception of a weak Japanese yen). The €/$ rate remained at 1.30 at month end.
|Last Updated on Monday, 17 December 2012 14:47|