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June Market Update

Posted by AndrewEarles on Friday 2nd of June 2017.

With just a week to go to the latest UK General Election, the UK stockmarket market_update.jpgand currency rates have been reacting to the fact that the gap between Theresa May and Jeremy Corbyn becoming Prime Minister is now much closer than initially anticipated.  In fact, one of the most recent polls, from YouGov, has predicted a hung parliament.
The FTSE 100 ended May at 7,519.95, which was 4.4% higher than the April closing figure of 7,203.94.  In fact, during the final day of the month (31 May), the FTSE 100 recorded a new intra-day all time high of 7,586.45, before slipping back slightly.
In the US, the Dow Jones Industrial Average was up slightly during the month at 21,005.93, a modest gain of 0.2% above April’s closing level.
In terms of £ Sterling, it ended the month at 1.2876 US Dollars, which was 0.6% lower than the end of April, falling back from what was its highest level achieved in more than six months during April.
Against the Euro, £ Sterling weakened more significantly, being 3.5% lower at 1.1454 Euros.
The Bank of England maintained the base rate at 0.25% again.  However, inflation, as measured by the Consumer Prices Index (CPI), increased to 2.6% in April 2017 (from 2.3% in March 2017), further impacting long-suffering bank and building society savers who are losing money in real terms when you consider the rate of savings interest compared to the rate of inflation.
This was further emphasized by a recent report from Money Mail, which stated that two years ago, the average rate paid by Britain's eight biggest banks to loyal savers with easy-access accounts was 0.33%.  However, this was now down to a mere 0.04% with the NatWest Instant Saver, RBS Instant Saver and HSBC Flexible Saver paying just 0.01%.
Over the next couple of weeks or so, the political landscape in the UK should become clearer and negotiations with the EU about Brexit will begin in earnest.  This may lead to a volatile period for investors and as usual it remains increasingly important to invest in a well diversified investment proposition.
The Omnis Managed funds, Openwork Graphene Model Portfolios and new Omnis Managed Portfolio Service 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.