Market Pulse - November 2021

Key themes

Continuation of strong Q3 earnings season

Inflationary pressures weigh on central bank policy

Omicron variant creates uncertainty on growth outlook

Markets snapshot

The MSCI AC World equity index fell -1.6% (gained +0.4% in euro terms).

The US fell -1.0% (gained +1.8% in €), outperforming, supported by strong earnings.

Emerging markets fell -3.2% (-1.4% in €), as they were viewed as more vulnerable to any negative shocks from the Omicron variant given greater risks of new restrictions being introduced.

The Eurozone >5-year bond index rose 2.3% in November as German 10 year yields fell to -0.35% on growth concerns related to the Omicron variant and the pushing out of expectations for the first ECB interest rate rise.

The euro fell to 1.1311 against the US dollar as investors discounted tighter policy by the Fed.

Commodities fell -10.8% (-8.3% in €) with WTI oil down -20.8% as demand expectations fell on news of the emergence of the Omicron variant and following a US-coordinated release of strategic oil reserves.

Gold fell -0.5% on the stronger US dollar.

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