The main US market indices finished negatively for the sixth consecutive week. This hasn’t happened since 2011. Most investors remain concerned about the influence of inflation on the economy, corporate profits, and the stocks’ assessments, when we take into account the US consumer price index released on Wednesday, 11th May.
The international stocks, presented by the index MSCI EAFE and MSCI EM, lost positions. MSCI EM lost the most, because the concerns about the economy rose in China because of COVID-19. The rise of the US dollar comparing other currencies is largely due to fears of a slowdown in China's economy.
Bonds
Comparing the stock markets, the index Bloomberg Aggregate Bond ended higher than last week. The profitability of the 10-year bond declined at the end of the week because of the increase of their price. At the beginning of the last week, the profitability was at its highest levels since 2018. Investors expect weaker economic results due to the position of the Fed and the rapid tightening of the monetary policy. However, the high-yield bonds, presented by the Bloomberg High Yield index, finished the week lower and kept their downward trajectory for 2022.
Raw materials and Metals had a weak performance
The prices of crude oil and natural gas ended without profitability because of the release of international reserves of fuels. The main metals gold, silver, and copper continued to lose ground for third consecutive week. Silver declined with more than 10% for the last week. All of the three materials are in the red zone for 2022.
Inflation and CPI
The inflation in April turned out to be slightly over analysts’ expectations. According to the CPI, prices rose by 0.3% compared to the previous month and by 8% compared to last year. There is an increase in the prices of services. It is very plausible that the inflation in the United States has reached its limits.
Employment
The requests for help for the unemployed increased on a weekly basis, but they, however, remain historically low. The US labor market remains very tight.
If you are interested in the investment opportunities which Compass Invest Management Company 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, ul. George Washington № 19, 2nd floor, 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.