The main indices ended this week on a negative territory. The investors’ mood was influenced by the negative comments of Tesla’s CEO – Elon Musk – and JP Morgan’s CEO – Jamie Dimon. They join the growing group of companies that announced the problems, which derive from the inflationary conditions. The Fed’s tries for “a soft landing” in the fight with the price pressure and the skepticism of many investors are also barriers for the markets.

 

Bonds ended on a green territory

The Bloomberg Aggregate Bond Index ended lower, reversing three consecutive weeks of rising. This decline is due to the increasing of the yield on the 10-year US government bonds. In May, the strong report of the labor market paused the bond investors, because some believe that the Fed will keep its hawkish mood. The corporate bonds with high yield Bloomberg High Yield Index ended higher for a second consecutive week.

 

Commodities ended in different directions

The prices of natural gas decreased and returned the two-week rate on higher indicators. In addition, crude oil ended higher for second consecutive week. European Union’s sanctions and tariffs on the Russian oil continue to cause pressure on the global energy prices. The prices of the key metals like gold and silver performed poorly, while copper rose. Despite the weak week, gold succeeded in maintaining a second consecutive week on a positive territory.

 

What will happen this week

1. At the end of the week, on Friday, we expect the release of data for the inflation in the US (CPI). This is a key indicator in Fed’s decision about how much to increase the main interest rate. The expectations are for 8.3% on an annual basis.

2. The meeting of the ECB (European Central Bank) will also be in the focus of the investors. Most central banks around the world began their process of tightening, but the ECB is two steps behind. Despite this, the rising inflation in the Eurozone causes pressure and brings with itself an urgency in ECB’s actions. The expectations are the first increase to happen during the third quarter this year.

 

✔ If you are interested in the investment opportunities which Compass Invest JSC can provide to you, please contact us for a free financial consultation according to your personal financial situation here.

 

Disclaimer:

This information is marketing material and does not present investment consultation, advice, investment research, or investment recommendation. The information is valid as of the issue date of the marketing material and may alter in the future. The value of the units in the collective investment schemes changes over time and it could be higher or lower from the value at the time of the investment. No profits are guaranteed and risk exists for the investors to not receive the full amount of their investments. Investments are not guaranteed by a guarantee fund which is created by the country or another form of guarantee. Information on the performance of the financial instruments in the past is not a reliable indicator for future performance. Therefore, it is recommended for investors to acquaint themselves with the Prospectus and the Document with key information for investors before making a final investment decision. You can find these documents in Bulgarian on the website of Compass Invest - www.compass-invest.eu, and you can request and get a free paper copy at the office of the management company at: Sofia, 19 George Washington Str, floor 2, during every business day from 9 am to 5 pm. Future results are subject to taxation, which depends on the personal situation of each investor and may change in the future. A summary of the rights of the investors is available at the following hyperlink in Bulgarian: here. The mutual funds, which are managed by Compass Invest, are actively managed without following an index. We would like to inform you that Management Company Compass Invest can make a decision to terminate the offering of funds on the territory of the Republic of Bulgaria. The investment in units of mutual funds, in addition to benefits, carries certain risks like: liquid, operational, interest, currency, and political risk, as well as macroeconomical risk, currency risk, concentration risk, etc. The full information about risks can be found in the Prospectus of the respective fund.