https://gam.gi/wp-content/uploads/2019/06/gamlogo.png 0 0 Mark Maloney https://gam.gi/wp-content/uploads/2019/06/gamlogo.png Mark Maloney2021-07-05 15:28:072021-07-05 15:29:08Market Commentary July 2021
It is the eternal mystery - the days are long, but the years are short - and 2021 is no exception, with the months whizzing by and the mid-year already here. History will likely remember 2020 as the COVID-19 pandemic year, and 2021 as the recovery year. The health recovery is clearly underway, thanks to vaccines. Yet vaccination rates vary widely country by country. Politics is a factor, along with suspicion about treatments that were developed so quickly. The economic recovery is equally underway, aided by government stimulus. People-facing industries are seeing a return to something like the pre-pandemic normal, although a shortage of workers is slowing the process. And it’s not just workers that are in short supply; everything from semiconductors to bricks are subject to lengthening lead times, with subsequent price rises leading many to fret about the inflationary implications.
https://gam.gi/wp-content/uploads/2019/06/gamlogo.png 0 0 Mark Maloney https://gam.gi/wp-content/uploads/2019/06/gamlogo.png Mark Maloney2021-06-07 14:40:342021-06-07 15:09:10Market Commentary June 2021
Stocks have been marching to a steady drumbeat of good news, reflecting vaccine distribution, general reopening optimism, and plenty of government stimulus to get a creaky economy back in gear. The parade stopped cold for a moment, however, before lurching back at an unsteady pace. The cause was inflation, which is as nefarious to markets as a reality as it is as a fear. The Consumer Price Index rose 1.6% in the 12 months to April 2021, up from 1% growth to March. Economists always say that a single month of data can be misleading, and that may have been the case with April’s inflation data. However, the CPI captures pricing trends across the economy, from the cost of raw goods to the consumer reaching for his or her wallet. The data may not be an indication of inflation getting “out of the bag”, but it cannot be ignored either.
https://gam.gi/wp-content/uploads/2019/06/gamlogo.png 0 0 Mark Maloney https://gam.gi/wp-content/uploads/2019/06/gamlogo.png Mark Maloney2021-05-10 14:27:102021-05-10 14:30:51Market Commentary May 2021
With April winding down, you can count on someone, somewhere saying, “sell in May and go away”. That pronouncement is mainly popular because it rhymes, but there is truth behind it. Since 1966 the All-Share index has delivered a total return after inflation of 7.9% on average from Halloween to May Day, but has lost an average of 0.6% from May Day to Halloween - even including dividends. This is because in March & April lighter evenings and warmer days cheer us up, which makes us more willing to take risks such as buying shares. So prices rise to high levels, which are difficult to sustain over the summer. Likewise, in the autumn the darker nights make us gloomier, with the result that prices fall to low levels from which they recover.