Monthly markets review - November 2017
- Global equities gained in November in US dollar terms. Regional disparity was higher than in recent months with US stocks advancing while European stocks retreated.
- US equities gained, supported by investor optimism that proposed tax reforms would improve corporate profitability.
- Eurozone equities retreated amid some profit-taking and currency strength. Some political uncertainty remained as talks over the formation of a new coalition government in Germany collapsed.
- The UK stockmarket saw negative returns as large caps and overseas-focused parts of the market performed poorly amid sterling strength as optimism rose over Brexit talks.
- In Japan, the TOPIX advanced amid a solid corporate earnings season with the majority of companies again exceeding expectations.
- Emerging market equities posted a marginally positive return. Growing expectations for US tax reform and the potential implications for global liquidity tightening both weighed on sentiment.
- Government bond yield curves saw a degree of flattening. Ten-year yields did little, but five and two-year yields moved higher, particularly on US Treasuries. This reflected some progress toward tax reform.
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