Our Views on the Markets and the Economy
Articles, investment updates and economic analysis
In recent years, Japanese stocks have enjoyed a period of stellar relative performance. Their resilience during the broader market weakness of 2022, followed by their outpaced rise during 2023 and so far in 2024, has been especially striking.
International Women's Day (IWD) celebrates the social, economic, cultural and political achievements of women on 8th March every year – and signifies a call to action to accelerate gender parity. Its ethos is very much in tune with the equality we foster at Netwealth: whether the environment we ensure to help a diverse employee community thrive, the leading roles women occupy across our business and also borne out in the ~50:50 ratio between female and male clients.
Three issues come to the fore in the wake of yesterday’s Budget. First is the fundamental challenge of Britain’s weak trend rate of growth. Second is that while the two pence cut in national insurance was welcome, it should not divert attention from the need for tax simplification and reform and that the UK’s tax take is high and still rising. Third, the challenge of low public investment, and the challenges facing non-ring-fenced departments in coming years.
Last week, SJP, the largest wealth manager in the UK, saw its shares fall 30% in a single day. The catalyst is increased regulatory concern about fees and ongoing services driven by the introduction last July of the Consumer Duty. The regulator is, once again, having to introduce legislation to ensure that financial consumers are being treated fairly and getting value for money.
Let me highlight three areas to focus on this March: the UK Budget; China’s annual Two Sessions meeting in Beijing; and the latest inflation data in western economies.
Our CEO Charlotte Ransom answers a weekly question for readers of the i paper – helping them to better understand their investments and how to effectively plan their finances to achieve their long-term goals. Many of these questions are also highly relevant for Netwealth readers.
What is the new normal? Globally, financial markets are coming to terms with a new geopolitical, economic and policy landscape.
The most dramatic change is geopolitical uncertainty and the risk of a further splintering world order. Many possible paths exist, and the multiple elections this year add to these.
A common goal among investors (and indeed investment providers) is to assess how a strategy is doing compared to competitors. Sometimes like-for-like comparisons are not so easy to attain, yet when you find an indicator that regularly proves its worth, it can greatly help investors to decide what level of risk and what investments are appropriate for them.
I warned of a pyrrhic victory over inflation. That is what we are now seeing as the UK economy contracted in the second half of last year under the weight of tight macro-economic policy. Inflation is 4% and is decelerating and likely to reach the 2% inflation target by the second quarter. Yet macroeconomic policy in terms of monetary and fiscal policy has remained too tight.
Team Contributors
Gerard Lyons
Charlotte Ransom
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Wealth management uncovered – clients will be the winners and it’s long overdue
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“I’ve inherited £240k. Should I ask a financial adviser what to do with it?”
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“I’ve just got divorced – how should I invest my £460,000 settlement lump sum?”
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“My husband and I downsized – what should we do with the £330k?”
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“My 62-year-old mum has £640k in the bank but a fear of investing – how can I help?”
Thomas Salter
Iain Barnes
Simon McConnell
In The Press
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Read what the press have to say about Netwealth