Monthly View.

Global equities continued their rebound in May, after good gains in April, as interest rate and geopolitical risks eased somewhat, and the tail end of the US corporate earnings remained strong.

Global equities rebounded in April, partly unwinding the declines from the previous two months. The rebound came despite a lift in global bond yields and reflected ongoing good growth in earnings.

Sharemarkets weakened for a second consecutive month in March, eliminating gains recorded in January. Major indices fell, the S&P 500 returned -2.69%, the FTSE 100 fell -2.54%, and the ASX 200 was down -4.27%.

Sharemarkets got off to a rocky start with the US S&P 500 index down 4.97% for the first week in February. This fed through to the NZX which was down 2.26% over the same period but managed to claw back most of that by the end of the month, to finish down -0.8%.

It is hard to see the excellent market returns of 2017 being replicated in 2018. Nevertheless, we do not see that we are in “bubble” territory just yet.