Capital IdeasTM

Investment insights from Capital Group

Categories
World Markets Review
Markets rally despite bank scare: Q1 roundup
April 14, 2023
Download PDF

Global stocks rose as investors welcomed signs from central bank officials in the U.S. and Europe that interest rates may not rise as much as previously expected. Lower inflation levels, combined with a crisis in the banking sector, prompted central bankers to consider adjusting monetary policy in the months ahead, leaving investors to speculate that there may be no additional rate increases this year.


Information technology stocks rallied, including many of the same companies that lost significant market value as the U.S. Federal Reserve (Fed), the European Central Bank (ECB) and others aggressively hiked rates in 2022 and early 2023. Stocks in the communication services sector also rose sharply as investors recalculated the perceived value of fast-growing companies in a potentially lower-rate environment.


Bond markets advanced as investors adjusted rate expectations going forward, suggesting that many see rate cuts coming before the end of the year. Fed and ECB officials continued to raise rates in March, but they made significant adjustments to the language and tone in their most recent monetary policy statements alluding to the impact of the banking crisis.


Learn more about
World Markets Review
Bonds
Global
Equity

Our latest insights

RELATED INSIGHTS

Past results are not predictive of results in future periods. It is not possible to invest directly in an index, which is unmanaged. The value of investments and income from them can go down as well as up and you may lose some or all of your initial investment. This information is not intended to provide investment, tax or other advice, or to be a solicitation to buy or sell any securities.

Statements attributed to an individual represent the opinions of that individual as of the date published and do not necessarily reflect the opinions of Capital Group or its affiliates. All information is as at the date indicated unless otherwise stated. Some information may have been obtained from third parties, and as such the reliability of that information is not guaranteed.

Capital Group manages equity assets through three investment groups. These groups make investment and proxy voting decisions independently. Fixed income investment professionals provide fixed income research and investment management across the Capital organization; however, for securities with equity characteristics, they act solely on behalf of one of the three equity investment groups.

Marketing communication

Past results are not a guarantee of future results. The value of investments and income from them can go down as well as up and you may lose some or all of your initial investment.

The information included on this site is of a general nature, and is not intended to provide investment, tax or other advice, or to be a solicitation to buy or sell any securities. It does not take into account your objectives, financial situation or needs. Before acting on the information you should consider its appropriateness, having regard to your own investment objectives, financial situation and needs. While Capital Group uses reasonable efforts to obtain information from third-party sources which it believes to be accurate, this cannot be guaranteed.

Statements attributed to an individual represent the opinions of that individual as of the date published and may not necessarily reflect the view of Capital Group or its affiliates. American Funds are not registered for sale outside of the United States.

This communication is issued by Capital International Management Company Sàrl (“CIMC”), 37A avenue J.F. Kennedy, L-1855 Luxembourg, unless otherwise specified, and is distributed for information purposes only. CIMC is regulated by the Commission de Surveillance du Secteur Financier (“CSSF” – Financial Regulator of Luxembourg) and is a subsidiary of the Capital Group Companies, Inc. (Capital Group).

In Hong Kong, this communication has been prepared by Capital International, Inc., a member of Capital Group, a company incorporated in California, United States of America. The liability of members is limited.

In Singapore, this communication has been prepared by Capital Group Investment Management Pte. Ltd., a member of Capital Group, a company incorporated in Singapore.  This advertisement or publication has not been reviewed by the Monetary Authority of Singapore. Neither has it been reviewed by any other regulator.

In Australia, this communication is issued by Capital Group Investment Management Limited (ACN 164 174 501 AFSL No. 443 118), a member of Capital Group, located at Suite 4201, Level 42 Gateway, 1 Macquarie Place, Sydney, NSW 2000 Australia.