Markets start to settle

The beginning of 2016 has been a challenging period for equity investors. The downturn in global equity markets which commenced in December continued through January to provide the worst New Year opening for 40 years.

February saw markets start to settle for the first time and begin to look as if they could recover some of the negative returns. The question for many is whether we are taking a rest from a continued bear market or if this is a turning point.

At this stage, we cannot be clear on the answer but what we do know is markets are still coming to terms with continued volatility in the Far East, especially as China attempts to reorganise its economy in a lower growth period. We are still unsure as to the ramifications of quantative easing in the developed economies and all of this leads to great uncertainty. There is no major positive news which is pushing markets forward. The only consolation is when investors become nervous, it is usually a good time to stay invested.

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