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Market Commentary

September Market Commentary

by Thornbridge

Commentary by Luna Investment Management Ltd – A Thornbridge Appointed Representative

Front of Bank of England (for the September Market Commentary article)

Commentary by Luna Investment Management Ltd – A Thornbridge Appointed Representative

The last two years it feels like we have been writing about the same points; inflation and interest rates. Unsurprisingly this month we are going to start on that same topic. That’s because the data released during the month was much better than had been expected; economists had been predicting UK Consumer Price Index (CPI) would increase slightly during the month, however, it fell to 6.7%.

Energy

Looking forward, inflation is most likely going to continue to fall; in October a lot of last year’s increase in energy and electricity will drop out of the equation and will actually be a deflationary force. It’s not all good news though, with OPEC looking to restrict supply, the oil price has picked up markedly over the summer, with Brent Oil moving from mid $70s in June to over $90 today. This will filter through over the coming months.

Rates

This positive news was followed by the Bank of England choosing not to hike interest rates for the first time since November 2021. Across the pond, the Federal Reserve also took the decision to hold interest rates. Forecasts released after the meeting showed the majority of policymakers expect rates to stand above 5.5% by the end of the year, implying at least one further hike.

In Conclusion

Against this backdrop markets provided mixed returns in September. All fixed income bonds sold off towards the end of the month. In equity markets, the FTSE All Share was one of the best performing global markets, whereas most other global markets fell during the month.

Author: Alex Hackett, Business Development Manager.

Alex a Business Development Manager and a member of the investment funds team and is involved in portfolio construction, regulatory reporting, trade surveillance and monitoring.

Author: Thornbridge

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