Hello,

Global equities fell 1.3% in euro terms last week amid the developing Middle East conflict. The market priced in higher inflation expectations as the price of oil surged 37.9% in euro terms — its largest weekly gain in futures trading since 1983. Equities in Europe (-5.8%) and Japan (-4.7%) were the hardest hit due to their reliance on energy imports, while US stocks, helped by greater oil self-sufficiency, finished flat in euro terms.

Gold and silver were down 0.4% and 8.4% in euro terms respectively as expectations for rate cuts weakened. In the UK, markets are now anticipating only one rate cut this year, down from two before the start of the conflict. In the US, expectations for rate cuts have been pushed out from July to September.

Heightened inflation expectations and a weaker economic outlook also drove a global bond sell-off. 10-year sovereign yields rose from 3.94% to 4.14% in the US, from 2.64% to 2.86% in Germany, and from 4.23% to 4.63% in the UK.

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Smart Financial Insurance Limited trading as Smart Financial is regulated by the Central Bank of Ireland. Past performance is not a reliable guide to future performance. The value of your investment may go down as well as up.