April Investment Bulletin
Posted by AndrewEarles on Thursday 6th of April 2017.
As widely reported, Theresa May triggered Article 50 during the month which begins the 2 year process for the United Kingdom to leave the European Union. This was closely followed by Nicola Sturgeon formally asking thePrime Minister to allow a second Scottish referendum.
Given the expectations around both events, and that they were already priced in by market-makers, these events had only a minimal impact on the stock markets and currency rates.
The FTSE 100 ended March at 7,322.92, which was 0.8% higher than the February closing figure of 7,263.44. Across the pond, the Dow Jones Industrial Average, which is the blue chip index for US Equities, closed the month at 20,663,22, which was 1.4% lower than February’s closing figure. This included the worst day since the election of Donald Trump as Wall Street worries about the prospects for the US president’s pro-business agenda triggered a rush for financial havens.
In terms of £ Sterling, it ended the month at 1.2550 US Dollars, which was 1.4% higher than the end of February. This slight recovery extended to the Euro where £1 now buys you 1.1785 Euros, which is 0.7% higher than the start of the month.
The Bank of England maintained the base rate at 0.25% again. However, it was announced that inflation, as measured by the Consumer Prices Index (CPI), rose to 2.3% in February 2017. This is devastating news for long-suffering bank and building society savers who are now losing even more money in real terms when you consider the rate of savings interest compared to the rate of inflation.
Many of these savers were probably holding out hope for the new National Savings and Investments (NS&I) Bond that was announced in the Autumn Statement and with the promise of market leading return. In his Budget speech, the Chancellor confirmed the details, which were a big disappointment with the new three-year "Investment Guaranteed Growth" bond paying only 2.2% on up to £3,000. This was only fractionally ahead other 3 year and 2 year bonds available from the High Street which have since been launched.
Then, as March was drawing to a close, the headlines were taken by Yorkshire Building Society, who announced an increase on the rate of their easy-access savings account from 1% to 1.15%, making it the highest rate on the market. This is exactly half the current rate of inflation (probably no coincidence) but just highlights the struggle for savers.
The Omnis Managed funds and Openwork Graphene Model Portfolios provide you with a diversified asset allocation in line with your Attitude to Risk, investing in Developed Market Equities, such as UK, US, Europe and Asia Pacific as well as Emerging Market equities. Cautious and Balanced investors will also have significant holdings in UK and Global Bonds, as well as Alternative Strategies.
We believe this multi-asset approach aims to give you the best opportunity for the highest level of return for your stated level of risk.
Past performance is not a guide to future performance. The value of an investment and any income from it can fall as well as rise as a result of market and currency fluctuations. You may not get back the amount you originally invested.