Market Outlook Report – March 2019

Market Overview

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.

Relevance/ Impact 

OECD cuts global growth forecast 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.

Relevance/ Impact 

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.

Relevance/ Impact 

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.

Relevance/ Impact 

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.

Relevance/Impact

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.

Relevance/ Impact 


This article is in the opinion of Reeves Independent financial advisers only and is not intended as advice and no investment decisions. The information in this blog or any response to comments should not be regarded as final advice. 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.