A Merry Christmas One and All

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This past week was another good one for US stock markets as investors look forward to the year ahead; as for Europe, the week was a little more mixed for the major developed indexes. Overall sentiment has changed dramatically in the past few weeks, as we have seen money flow away from money market funds and back into equities as the feeling grows ever stronger that interest rates have peaked and looser monetary conditions are on their way. Last week, the Central Banks of the UK, the US and Europe tried to temper expectations for the year ahead to a degree, but the message fell on stony ground.

With the final few days of the year, the outcome is one, not many, if any, predicted. It was not hard to find the bears in early 2023. This coming week, we will get Consumer inflation data from the UK, Europe and the US. We also get GDP updates from the US and UK. The probability is that these reports will reinforce the view inflationary pressures continue to ease.

I will take the opportunity now to reflect on the year and look forward to the year ahead which as usual, will bring its surprises and challenges. It is fair to say the investment community is starting this year with a different mindset from the one that started in 2023.

We wish everyone a happy Christmas and a prosperous New Year.