Written by Cormac Nevin.
Last week provided some welcome relief for UK investors, as the MSCI All Country World Index rose +4.1% in GBP terms (up +3.3% in local currency terms). This was driven primarily by US tech stocks, with the NASDAQ 100 Index up +6.6% (in GBP terms).
The shifting sands of the UK political landscape have been difficult to keep up with, and this past weekend and this morning have been no exception. Following the resignation last week of the UK’s shortest serving Prime Minister, it was announced on Sunday that Boris Johnson had withdrawn from the race to be Liz Truss’s successor. This leaves the field wide open for Rishi Sunak, who appears to be the market’s favourite candidate as the news caused gilt yields to drop sharply and Sterling to rally.
Other political developments driving markets last week and this morning included the continuation of the National Congress of the Chinese Communist Party. Increasingly hostile verbiage from Xi Jinping towards the country’s wealthy and the tech sector, more generally, caused Asian markets to sell off heavily. The delayed release of the country’s slowing gross domestic product figures also caused the Hang Seng Index of Hong Kong listed equities to fall over 5% on Monday.