On lighter-than-normal volumes, as we enter the Christmas run-in, global equity markets were mixed this week as the anticipated Santa rally failed to gather much momentum.
US shares came under pressure on Thursday after revised GDP data indicated that the US economy grew faster than previously thought in the third quarter, sparking fears that the Federal Reserve will be required to hike interest rates further than expected.
The other major news during the week came from the Japanese central bank. It caught markets by surprise by amending its yield curve control policy to allow the 10-year Japanese government bond yield to move 0.5% on either side of its 0% target, up from 0.25% previously. By changing the policy the bank hopes to “improve market functioning and encourage a smoother formation of the entire yield curve, while maintaining accommodative financial conditions,” the BOJ said.
After what has been a challenging year for investment markets, I wanted to take the opportunity on behalf of all the team at MHA Caves Wealth to thank you for your continued support. We wish you all a very Merry Christmas and a prosperous New Year.
John Naylor, Chartered FCSI – Head of Investment Committee