Archived insights remain available on the site. Please consider the publish date while reading these older insights.
publish

Monthly Market Snapshot: March 2021

A monthly update on equity, fixed income, currency, and commodity markets.

Views expressed are those of the authors and are subject to change. Other teams may hold different views and make different investment decisions. While any third-party data used is considered reliable, its accuracy is not guaranteed. For professional or institutional investors only.

Equities

Global equities (+3.6%) advanced for the second consecutive month, ending March with a 6.0% gain year to date. Markets continued to rise amid the accelerating global rollout of vaccines, a favorable outlook for global economic growth, and substantial liquidity support from governments and central banks. Massive stimulus measures, combined with pent-up savings and significant supply chain disruptions throughout the global economy, fueled expectations for higher inflation. That increased concerns that central banks may have to tighten monetary policy to an extent that could impair equity markets. The US Federal Reserve (Fed) maintained its dovish policy stance, signaling that interest rates are expected to remain unchanged through 2023 despite upgrades to its economic outlook. However, prominent emerging markets (EM) central banks (Brazil, Turkey, Russia) surprised markets with larger-than-expected increases in policy rates, reflecting the domestic challenges posed by higher inflation and rising US Treasury yields. Despite a broadening rollout of vaccines, global coronavirus trends remained volatile, with Europe experiencing a sharp rise in COVID-19 infections, extended lockdowns, and a slow vaccine rollout. In contrast, vaccinations in the UK accelerated sharply, and US President Joe Biden announced that America is on track to have enough vaccines for every adult by the end of May.

US

US equities (+4.4%) registered strong returns, with inflows into US stocks surging amid an accelerating vaccine rollout, massive fiscal stimulus, and ultra-easy monetary policy. A recent uptick in COVID-19 infections in some areas and the increasing prevalence of virus variants were overshadowed by better vaccine distribution and reopening efforts. Expectations for a robust rebound in economic growth and forecasts of higher inflation drove cyclical and value stocks to significantly outperform their growth and momentum counterparts. A sharp rise in Treasury yields poses a potential headwind for risk assets, although Fed Chair Jerome Powell reiterated his belief that inflation will not rise above the Fed’s 2% target for long enough to warrant a change in policy. The Fed anticipates that interest rates will remain close to zero through 2023. It also raised its median economic growth projection for 2021 to 6.5%, up from 4.2% in December, due to the accelerating vaccine rollout and massive fiscal stimulus. President Biden signed into law a US$1.9 trillion coronavirus relief bill and introduced an infrastructure package worth approximately US$2.3 trillion, proposing to fund the initiative largely though higher corporate taxes. The infrastructure plan…

To read more, please click the download link below.

RECOMMENDED FOR YOU

Financial Market Review: First quarter 2021
A quarterly review of results in the global equity, fixed income, currency, and commodity markets.
Archived insights remain available on the site. Please consider the publish date while reading these older insights.
publish
April 2021
Financial Market Review: First quarter 2021
,
publish
<span>Top of Mind</span> History rhymes, opportunity knocks: Thoughts on market bubbles, inflation, and timely allocations
Multi-Asset Strategist Adam Berger flags bubble warning signs in several markets, updates his inflation forecast, and offers a framework for opportunistic investments.
Archived insights remain available on the site. Please consider the publish date while reading these older insights.
publish
April 2021
Top of Mind History rhymes, opportunity knocks: Thoughts on market bubbles, inflation, and timely allocations
,
publish
An allocator’s agenda for a reflating world
Multi-Asset Strategist Nick Samouilhan and Investment Directors Andrew Sharp-Paul and Matthew Bullock focus on some suggested ”to-do” items for asset allocators in response to the potentially reflationary impact of the COVID-19 vaccines and fiscal policy stimulus.
Archived insights remain available on the site. Please consider the publish date while reading these older insights.
publish
April 2021
An allocator’s agenda for a reflating world
,
publish
Investor roundtable: A holistic approach to climate research
In this 15-minute roundtable conversation, our climate experts offer their perspectives on the risks and underappreciated investment opportunities associated with climate research.
Archived insights remain available on the site. Please consider the publish date while reading these older insights.
publish
April 2021
Investor roundtable: A holistic approach to climate research
,
publish
<span>Insurance Multi-Asset Outlook — </span>Rising rates: Threat or opportunity?
Multi-Asset Insurance Strategist Tim Antonelli and Investment Strategy Analyst Daniel Cook argue that now may be an opportune time for insurers to adopt a more pro-risk stance, despite the potential headwind of rising rates.
Archived insights remain available on the site. Please consider the publish date while reading these older insights.
publish
April 2021
Insurance Multi-Asset Outlook — Rising rates: Threat or opportunity?
,
publish
Tim Antonelli
 CFA, FRM, SCR
There’s more to inflation risk than meets the eye
Understanding and evaluating inflation risk in your portfolio is the first step to managing it effectively. Multi-Asset Strategists Nick Samouilhan and Adam Berger lay out a framework for investors to do just that.
Archived insights remain available on the site. Please consider the publish date while reading these older insights.
publish
April 2021
There’s more to inflation risk than meets the eye
,
publish
Nick Samouilhan
 PhD, CFA, FRM
<span>Multi-Asset Outlook — </span>The road to recovery: Strong but short?
While global policy support remains in high gear and risk assets have responded, Nanette Abuhoff Jacobson and Danny Cook consider the possibility of a relatively swift turn in the economic cycle and the potential investment implications.
Archived insights remain available on the site. Please consider the publish date while reading these older insights.
publish
March 2021
Multi-Asset Outlook — The road to recovery: Strong but short?
,
publish
Monthly Market Snapshot: February 2021
A monthly update on equity, fixed income, currency, and commodity markets.
Archived insights remain available on the site. Please consider the publish date while reading these older insights.
publish
March 2021
Monthly Market Snapshot: February 2021
,
publish