Client Communication
What’s the story?
This week has been better so far. We have seen the brave soldiers of Mariupol at least getting out from under the terrible conditions they have been surviving in so far. Let’s hope and pray they are treated fairly and not used as pawns in this ongoing “special military exercise”. We have had no unexpected shocks in the markets or more bad news. Changes to the Northern Ireland protocol might mean some local issues, but globally it’s been a quiet one.
We have seen Crypto collapsing in value but then none of us are particularly exposed to that, I hope.
We also can start to look at where we are investment wise. We have now reached what must be the pinnacle of inflationary pressure and hopefully the bottom for a number of assets. The below shows the extent of the asset class falls over one year. Of course, anything can happen in markets but value is apparently there. There is buying happening and the return of some growth rather than continued losses. Will now be a time we will wish we could go back to and make smart decisions??
Bloomberg as at 18/05/2022. TR denotes Net Total Return.
My Opinion.
This feels like a ceiling for inflation and a floor for asset classes. So, the sensible thing is to stay invested and await this all to reverse. No guarantees, it just feels like we have everything priced in and then some more.
If instead of staying still you are feeling bullish it could be time to clear out some of the old investments you have not looked at for ages or underemployed cash and make those investments you have been waiting to make.
Investment Manager Opinions.
I asked for some specific comments from Henry Wilson at LGT Management on the situation in the Ukraine, inflation, interest rates, recessionary pressure and likely outcomes, he said:
“There are particular pockets of value appearing in some of the higher quality US tech stocks like Alphabet and Adobe. I copy below a section which covers this off”.
Summary
So, are we as far as we can go in this litany of financial issues and market falls? It certainly looks like it, so we all are optimistic in the recovery being possible from this foundation of value in asset prices.
Will the sunshine on the markets as its shines on us? We hope so.
Regards Andy