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Positive summer performance despite roaring inflation

Market Rewind
Søren Otto Simonsen

Senior Investment Editor

Summary:  July's market performance reveals positive equity performance despite rate hikes and steep inflation. The results come on the back of a better-than-expected earnings season (so far) as well as positive European growth figures.


Global equities climbed more than 7% in July. The positive performance may seem surprising, seeing as the global economy is still dominated by uncertainty, inflation and supply chain issues. But other financial events such as the Q2 earnings season and European growth figures during the month have been more positive, pushing equities upwards. The FOMC meeting late in July, where the American central bank, the Federal Reserve, discusses (and adjusts) interest rates, also seemed to be viewed as positive by the markets.

The US was the strongest performing region: its equity index climbed by 9%. Europe followed with 7.5% whereas Asia’s performance was slightly positive. Emerging Markets fell 0.7% for the month.

All sectors ended in positive territory. Consumer Discretionary and Information Technology was the biggest gainers cashing in more than 15 and 13 % respectively due to, among other things, positive earnings reports.

The Dollar Index Spot strengthened more than a full percentage point over the course of July. The greenback shot up early in the month but fell pretty sharply after the surge mid-month, following the FOMC meeting and in the wake of the negative first estimate for Q2 US GDP growth.

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.

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