Monthly markets review - October 2015
An overview of markets in October 2015, when equities posted strong positive returns amid hopes of more accommodative monetary policy from central banks.
Unstructured Learning Time
- Global equity markets staged a rebound in October. A Chinese rate cut and speculation over the prospect of looser monetary policy from several other central banks helped to support risk appetite.
- US equities rose amid a better-than-expected start to the earnings season. The Federal Reserve kept rates unchanged but indicated that a hike in December remains a possibility.
- Eurozone and Japanese equities were supported by expectations that their respective central banks may soon move to ease monetary policy further.
- Emerging markets posted positive returns, narrowly lagging developed markets. China’s central bank cut interest rates following a Q3 GDP print which indicated growth eased to 6.9% year on year.
- In fixed income markets, European sovereign yields fell and Treasury yields rose due to the divergent outlook for monetary policy. The ‘risk-on’ environment helped drive the outperformance of high yield bonds versus their investment grade equivalents across the US, Europe and UK.