January saw global equity markets make positive ground following recent weak performance. All major equity indices made gains over the month, with the S&P 500, FTSE 100 and Nikkei 225 up 8.0%, 3.6% and 3.8% respectively. Despite this turnaround, the same underlying geopolitical issues still seemed to persist. However, this time, added to the mix, was the US Government shutdown. As the 29th March approaches, progress with regards to Brexit was lacking. There was temporary optimism as MPs voted in favour of replacing the backstop, the insurance policy designed to avoid a hard border in Ireland in the event of a no deal. However, the EU seems adamant that there would be no change to the deal already agreed. Despite this gridlock, the pound rose 3.0% against the euro. Amongst other currencies, the pound rose 2.9% against the US dollar. In the fixed income market, the yield on US, UK and Germany 10-year bonds decreased 5, 6 and 9 basis points respectively.
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