charlwood-logocharlwood-logocharlwood-logocharlwood-logo
  • Home
  • About us
  • Our values
  • Services
    • Wealth Management
    • Investments
    • Pensions and Retirement Planning
    • Inheritance Tax Planning
  • News & Media
  • Market Updates
  • Contact Us
  • Wealth Management
  • Investments
  • Pensions and Retirement Planning
  • Inheritance Tax Planning
  • Market commentry updates
Saturday 23rd January
Client login

Commentary on July 2014

Market Overview

Markets had to contend with a growing wave of potentially upsetting events; in addition to the geopolitical wobbles in the Ukraine and Middle East, Portugal’s largest bank collapsed, the EU voted to back the US with tougher sanctions on Russia, a spate of corporate earnings failed to meet expectations and fears grew that interest rates in the US might rise sooner than expected.

 Russian and European stockmarkets were hardest hit with falls in the region of 5-7%; Portugal fell by 13% on contagion fears following the failure of Banco Espirito Santo.

In the US strong employment data sent the Dow Jones index to a record high above 17,000, but the market ended the month nearly 600 points lower. The US Federal Reserve cut monetary stimulus (QE) by a further $10bn a month and signalled an expected end to QE in October.

In contrast to the woes of most developed markets, Emerging markets had a stellar month with gains of 2-4%.

Bond yields continued to fall across Europe as fears of deflation persisted. German bunds hit a record low of 1.12% whilst Italian and Spanish bonds both hit 2.5%,on a par with the US and UK!

Our Views

We are happier to believe in the UK growth story than in most other economies. There’s a greater consistency of economic data pointing towards an expanding economy with, as yet, few signs of inflationary pressures. We expect this momentum to build going into the general election next May.

However, the FTSE index is currently looking tired and was flat over the month. For now there is technical support between 6600-6700 level but the greater risk lies in a more meaningful correction. We would look to use this opportunity to buy shares at the lower levels.

We remain cautious on valuation levels in the US; this market has hit repeated new highs and stronger economic data is suggesting that perhaps the previous weaker growth numbers were weather-related. However, a lot of good news had been priced in and a sell-off at the end of the month reversed all of the summer’s gains.

Bond yields in our view still remain too low to compensate for the risk of capital loss. The collapse of a Portuguese bank sent shivers through the market prompting a rare fall in high-yield prices.

How are we currently positioned?

On our lower-risk portfolios we continue to prefer a blend of equity income, property and absolute return funds to fixed interest assets. During the month we reduced exposure to high-yield bonds, switching into a fund with higher credit quality and less exposure to rising interest rates.

In equities, we generally prefer the defensive qualities of income funds to growth funds. Towards the end of the month we slightly reduced our equity exposure, including our weighting in the US. For most funds we switched into a less volatile absolute return fund but on the higher risk funds we increased the holding in property.

We continue to prefer the value in emerging markets to developed markets, although we recognise that this differential has tightened over the past few months. Our emerging market holdings were among the top performers, rising by 2-4% over the month.

Our gold funds continued to perform well, gaining around 3% on the month. This supported our view that gold has bottomed and is a sensible long-term hold.


  • Commentary on November 2020

    Commentary on November 2020

    Commentary on November 2020 FESTIVE GREETINGS FROM CHARLWOOD’S   Market Overview Optimism over the likelihood of 3 vaccines, and the […]READ MORE
  • Commentary on September 2020

    Commentary on September 2020

    Commentary on September 2020   Market Overview After hitting record highs throughout August, US shares dragged stock-markets lower in September […]READ MORE
  • Commentary on July-August 2020

    Commentary on July-August 2020

    Commentary on July-August 2020 We trust this email finds you well. If you have any queries or seek any clarification […]READ MORE
  • Commentary on June 2020

    Commentary on June 2020

    Commentary on June 2020 We trust this article finds you well. If you have any queries or seek any clarification […]READ MORE
  • Commentary on May 2020

    Commentary on May 2020

    Commentary on May 2020 On A Personal Note….. We hope this email finds you and your family and friends in […]READ MORE
  • Commentary on March 2020

    Commentary on March 2020

    Commentary on March 2020 First and Foremost…… During these very worrying and concerning times we realise that money matters become […]READ MORE
  • Commentary on February-March 2020

    Commentary on February-March 2020

    Commentary on February-March 2020 First and Foremost…… Whilst the below provides an update on investment related matters, first and foremost, […]READ MORE
  • Commentary on January 2020

    Commentary on January 2020

    Commentary on January 2020 Market Overview January newsflow lurched from concern as the U.S. stumbled towards war with Iran, to […]READ MORE
  • Commentary on December 2019

    Commentary on December 2019

    Commentary on December 2019 Market Overview December witnessed a euphoric close to the decade as markets reacted to a landslide […]READ MORE
See All

Latest News

Rated Best Business

  • A Post-summer Update As we return from our virtual summer holidays, we thought it would be useful to update you on the state of the market and on how... Read more ...

Charlwood IFA Ltd

35 Seamoor Road, Westbourne,
Bournemouth, BH4 9AE
Tel: (01202) 768512

Office Facilities

73 High Street, Lymington, Hampshire SO41 9ZA
23a Spencer Road, New Milton, Hampshire BH25 6BZ

Contact Us

Charlwood IFA is a trading style of Charlwood IFA Ltd which is authorised and regulated by the Financial Conduct Authority. Charlwood IFA Ltd is Registered in England; Registered No: 04820268.
The guidance and/or content within this website is subject to the UK regulatory regime and is therefore targeted at consumers based in the UK. Telephone calls to and from Charlwood IFA may be recorded for quality, security and training purposes. Copyright © 2020 CharlwoodIFA. VAT No. 141 8758 95. Privacy Policy