Market Pulse - February 2022

Key themes

Global equities fell for a second straight month as markets responded negatively to the news that Russia had launched a full-scale military offensive against Ukraine.

The early part of the month was already negative for equities, with central banks dominating news flow as investors increased bets on aggressive interest rate hikes from central banks.

Commodity prices moved swiftly higher due to Russia’s importance as a global commodity producer.

Markets snapshot

The MSCI AC World equity index fell -2.6% (-2.7% in euro terms).

The US fell -2.9% (-3.1% in €) as growth stocks were hit hard on the back of market pricing of interest rate hikes, while Russian actions in Ukraine increased risk-off sentiment into month end.

The UK outperformed, gaining 0.8% (0.6% in €), and benefitted from its relatively large weight in energy and material stocks, which were supported by higher commodity prices.

Emerging markets fell -2.4% (-3.2% in €)

The Eurozone >5-year bond index returned -2.8% in February as bond markets continued their sell-off from 2021.

The euro fell to 1.1205 against the US dollar, with the dollar rising due to its safe haven status in times of market stress.

Commodities rose +8.8% (+8.6% in €), bringing their year-to-date return to 21.4% (22.9% in €). WTI oil was up +8.6%, bringing its year-to-date increase to 44.6%. Oil prices breached $100/ barrel during the month, reaching their highest level since 2014. European gas prices rose 17.3% to €99/mwh.

Gold rose 4.0%, supported by safe-haven demand.

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