Market Pulse - November 2023
- Monthly Market Pulse
- 07.12.23
Key themes
- Global bond and equity markets rallied strongly in November, as investors welcomed signals that rates had peaked and that slowing inflation and economic activity could lead to monetary easing in 2024.
- Economic data showed slowing US activity compared to somewhat improving data in the Eurozone.
- Major central banks, especially the Federal Reserve (Fed) and the European Central Bank (ECB), continued to emphasise the need to keep policy restrictive for longer to tame inflation. However, some monetary policy committee members noted the potential for lower rates amid slower inflation.
Markets snapshot
- Global equities rebounded strongly in November, buoyed by slowing inflation and the potential for easier monetary policy in 2024. The MSCI All Country World index rallied by 8.1% (+5.9% in euro terms) over the month.
- The US rose by 9.4% (+6.0% in euros).
- European ex-UK equities rose by 6.9% (+7.4% in euros).
- Bond markets also rallied strongly, with yields falling as inflation fell and rate markets priced in monetary easing from the Fed and the ECB as soon as Q2 2024. The ICE BofA 5+ Year Euro Government bond index rose by 4.4% over the month. US and German 10-year yields declined significantly, by 60bps to 4.33% and by 36bps to 2.45%, respectively.