Equities move lower as markets struggle with inflation – Zurich Life Weekly Investment News Monday 24th April 2022

Weekly Investment News

Major US equity indexes ended the week lower last week. Within the S&P 500, the communication services sector was the worst performing sector. Shares of Netflix fell over 35% as the streaming giant reported disappointing quarterly results followed by a fall in the number of subscribers for the first time in a decade. Only the consumer staples sector gained ground. European equities fell amid ongoing concerns about the war in Ukraine and increased hawkishness among central bank policymakers.

Core eurozone bond yields (which move inversely to price) ended higher, as hawkish comments from policymakers at key central banks drove a broad sell-off in high-quality government bonds. In the UK, business activity grew at the slowest rate in three months in April while inflation continued to accelerate. UK financial markets indicated that there are expectations the Bank of England will likely raise its key interest rate by a quarter point to 1.0% in May.

In France, Emmanuel Macron defeated far-right candidate, Marine Le Pen, to win five more years as president. He becomes the first sitting president in twenty years to be re-elected. Macron’s victory was welcomed by many European leaders, who had feared a far-right candidate offering a series of anti-EU policies.