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Monthly Review - March 2023

one year ago

The Markets



S&P 500




FTSE 100


CAC 40


DAX 30


BEL 20






 Source: Bloomberg 31.03.2023
No easy solution

No easy solution

As stress mounted in the banking sector on both sides of the Atlantic, central banks were caught in a tricky position. While high levels of inflation have necessitated tighter monetary policy, central banks have been forced to increase liquidity to guarantee financial stability and reassure the markets. The US Federal Reserve (Fed) was described as having to be ‘both policeman and firefighter’. Fed Chair Jay Powell carefully trod a middle path, raising rates to check inflation, while offering reassurance that the US banking system is both sound and resilient.

Zero emissions challenged

Zero emissions challenged

The European Commission (EC) has agreed an exemption to its law banning the sale of combustion engines after 2035. This follows objections from Germany, where car production forms a significant part of the manufacturing industry. It is forecast that up to 40% of jobs in this sector could be lost should the original legislation be enacted. The EC will now permit combustion engines that run only on e-fuels, which are viewed as carbon neutral. But e-fuel technology is costly and still in development. Both France and Sweden protested about a potentially massive diversion on the road to electric only vehicles.

Tech back on top

Tech back on top

The tech sector has regained its dominance of US equity markets, representing close to 30% of the S&P 500. Apple and Microsoft alone account for over 13% of the index. This follows a difficult year in 2022, when prices fell as rising interest rates made the valuation of some tech stocks appear less attractive. But not all is rosy in the sector. Despite proudly announcing that its metaverse avatars now have legs, Meta Platforms has launched a profitability ‘manifesto’, after sales slipped last year and as R&D costs continue to soar.

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