Market Pulse - October 2022

Key themes

  • Despite global equity and bond markets reaching new year-to-date lows during October, both rallied to finish the month higher, with equities in particular generating strong gains.
  • Continued upward surprises in inflation readings and hawkish rhetoric from central banks contributed to the initial falls.
  • Equity markets established a floor before bonds, with early third-quarter earnings results ahead of expectations, while key technical levels also provided support. A slight change in tone from global central banks, and the resultant renewed speculation about a possible policy pivot, was a key catalyst behind the late-month rally.


Markets snapshot

  •  The MSCI AC World equity index rose 6.1% (5.1% in euros).
  • US equities rose 7.9% (7.0% in euros) on suggestions the Fed could begin to slow the pace of interest rate rises from December.
  • European equities also outperformed, rising 7.2% (6.6% in euros) as the European Central Bank (ECB) suggested the scale of interest rate rises could be lower than previously indicated.
  • Pacific Basin equities underperformed, rising only 0.6% (-0.4% in euros) as Hong Kong was sharply lower due to a disappointing interpretation of the future policy path after the 20th Chinese Party Congress.
  • Emerging market equities also lagged, falling -2.6% (-3.9% in euros), for similar reasons.
  • The Eurozone >5-year bond index rose slightly, by 0.3%. German 10-year yields initially rose to 2.53%, the highest since 2011, as investors feared ongoing tightening of monetary policy in a persistently high inflation environment. Yields, however, fell into month end as global central bank rhetoric became less hawkish.
  • The euro rose slightly, by 0.8%, against the dollar to 0.9887.
  • Commodities rose 6.7% (5.8% in euros). Brent oil rose 8.9% as OPEC+ announced plans to cut production by 2 million barrels per day to support the oil price.
  • Gold was down -1.5%, with the initial strength in the US dollar acting as a drag.



Property Reports

Pension Irish Property Fund - Quarter 1 2023

The increase in interest rates and general market volatility caused a reduction in property market activity from Q3 2022, with valuers marking down values on the back of negative sentiment, in the absence of specific evidence, in the latter months of 2022. This year has started off in the same vein, with relatively low levels of investment due to increased costs of equity and debt capital, limited stock being placed on the market, and reduced vendor confidence of deals completing.

Read more Download


Market Pulse

Market Pulse - April 2023

Each month, Lenny McLoughlin, Chief Investment Strategist sifts through market noise to pinpoint the key themes that have influenced markets – and impacted your investments. Lenny also shares his insights on the forces shaping markets in the short-to-medium term.

Read more Download
See all insights