Quarterly Outlook
Equity outlook: The high cost of global fragmentation for US portfolios
Charu Chanana
Chief Investment Strategist
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"Carnage" is the only right word for September market performance
Market Rewind
Søren Otto Simonsen
Senior Investment Editor
Summary: "Wake me up when September ends," is not only a megahit by the American rock band Green Day, but probably also a trading strategy that many investors would have liked to adopt in 2022. Sleeping the month away would have shielded you from what can only be viewed as a bloodbath - unless you've invested in the US Dollar.
Flirting with double-digits, global equity markets were down over nine percent for the month of September. The performance was fueled by the – by now – usual suspects of high inflation, macropolitical unrest, increasing interest rates and also a growing focus on currency developments.
Looking at the equity regions, Europe stands out as the least bad region, whereas Asia takes the unfortunate last place. All regions fell by more than six percent.
Dividing equities into sectors makes the picture even worse. Five out of the 11 so-called GICS sectors posted double-digit losses and only Health Care avoided falling more than five percent. Real Estate suffered the biggest loss with -13.2% as the sector was hurting by, among other things, rapidly increasing interest rates.
Just like in August, the USD Bloomberg Spot Index was the only positive figure on this market performance infographic. The Dollar strengthening comes on the back of a tough month for global currencies and especially the British Pound which has taken a beating.
Check out the rest of this month’s performance figures here:
Sources: Bloomberg & Saxo Group
Global equities are measured using the MSCI World Index. Equity regions are measured using the S&P 500 (US) and the MSCI indices Europe, AC Asia Pacific and EM respectively. Equity sectors are measured using the MSCI World/[Sector] indices, e.g. MSCI World/Energy. Bonds are measured using the the USD hedged Bloomberg Aggregate Total Return indices for total, sovereign and corporate respectively. Global Commodities are measured using the Bloomberg Commodity Index. Oil is measured using the next consecutive month’s WTI Crude oil futures contract (Generic 1st 'CL' Future). Gold is measured using the Gold spot dollar price per Ounce. The US Dollar currency spot is measured using the Dollar Index Spot, measuring it against a weighted basket of the following currencies: EUR, JPY, GBP, CAD, SEK and CHF. Unless otherwise specified, figures are in local currencies.
Global equities are measured using the MSCI World Index. Equity regions are measured using the S&P 500 (US) and the MSCI indices Europe, AC Asia Pacific and EM respectively. Equity sectors are measured using the MSCI World/[Sector] indices, e.g. MSCI World/Energy. Bonds are measured using the the USD hedged Bloomberg Aggregate Total Return indices for total, sovereign and corporate respectively. Global Commodities are measured using the Bloomberg Commodity Index. Oil is measured using the next consecutive month’s WTI Crude oil futures contract (Generic 1st 'CL' Future). Gold is measured using the Gold spot dollar price per Ounce. The US Dollar currency spot is measured using the Dollar Index Spot, measuring it against a weighted basket of the following currencies: EUR, JPY, GBP, CAD, SEK and CHF. Unless otherwise specified, figures are in local currencies.
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