​Market Outlook Summary 
March 2019

Investors pile back into shares

Investors around the world poured money into stock market funds last week at the fastest rate in a year, hoping to exploit the continuing rebound from December’s market sell-off.

OECD cuts global growth forecase over trade wars and Brexit  

The Organisation for Economic Co-operation and Development cut its growth projections for almost every economy in the G20 for the next two years.
Despite the reduction in the projected growth rate, the OECD believes that Britain’s GDP will improve faster than that of Germany, raising the possibility that it will outpace the largest economy in Europe.

Eurozone slowdown forces ECB to revive stimulus 

Europe’s banks are to be flooded with another round of state-subsidised loans this year after the European Central Bank scrapped plans to tighten monetary policy in the face of collapsing eurozone growth.

The decision to reverse policy just months after the bank ended its €2.6 trillion quantitative easing programme underscored the fragile state of the eurozone, which enjoyed a resurgence for about 20 months from 2016.

Prospects for European stock markets  

Shrewd commentators believe that the general gloom surrounding Brexit and the European economy have created an opportunity for sharp-eyed investors to buy valuable European stocks cheaply.

Search for safe havens sends bond yields down

Government borrowing costs have dropped to their lowest level in 18 months after doveish signals for growth from the US Federal Reserve and the rising threat of a no-deal Brexit. After a two-day meeting, policymakers in Washington unanimously voted to leave the US interest rate range at between 2.25 per cent and 2.5 per cent in March. They changed their outlook for 2019 from two rises to none.

The Bank of England also voted unanimously to hold rates at 0.75 per cent and left quantitative easing unchanged at £435 billion. It also upgraded its growth forecast for the first quarter to 0.3 per cent from the 0.2 per cent it predicted in February.

For a fund that will take flight, pick one run by a wise old owl

Out of 1,400 unit trusts with a 10-year track record, 7 of the top 10 managers have spent more than a decade in charge. 8 of the 10 unit trusts in the UK all companies sector with the best 10-year performance are run by managers who have been in charge for more than a decade. 

It is important that no actions should be taken without first taking advice. Personal circumstances and an individual’s appetite for risk means that the advice for one person may not be the same for everyone. Please remember that the value of your investment can go down as well as up, and may be worth less than you paid in. Information is based on our understanding at March 2019.