April 2022

• Global markets weakened in April as inflation remained elevated, central banks adopted increasingly aggressive tightening stances and concerns regarding slowing economic growth intensified.
• Technology and growth stocks experienced sharp declines as bond yields rose significantly.
• China’s renewed coronavirus lockdowns disrupted global supply chains and increased fears of weaker global demand.
• Commodity prices remained elevated due to ongoing geopolitical tensions and supply shortages.
• Emerging markets faced pressure from stronger U.S. dollar conditions and tighter financial markets.
• Investor sentiment deteriorated amid fears of stagflation and slowing corporate earnings growth.

Asia (ex. Japan)

Asian markets outside Japan weakened significantly during April as strict coronavirus lockdowns across major Chinese cities disrupted manufacturing, logistics and consumer activity. Investors became increasingly concerned about slowing Chinese growth and broader supply chain disruptions.

Technology-focused markets such as Taiwan and South Korea also came under pressure from rising global bond yields and weaker sentiment toward growth sectors, despite continued long-term semiconductor demand strength.

Europe

European equities declined during April as rising inflation, higher energy costs and tightening monetary policy expectations weighed heavily on investor sentiment. Concerns regarding economic slowdown intensified across the eurozone.

The war in Ukraine continued disrupting energy and commodity markets, increasing recession fears for several European economies heavily dependent on imported energy supplies.

United States

U.S. equities experienced sharp declines during April as rising Treasury yields and increasingly hawkish Federal Reserve guidance pressured technology and growth sectors significantly.

Inflation remained near multi-decade highs, leading investors to anticipate aggressive interest rate increases and balance sheet reduction measures from the Federal Reserve. Concerns regarding slowing economic growth and weakening consumer sentiment also intensified.

United Kingdom

UK equities weakened during April despite support from energy and commodity-related sectors. Rising inflation and slowing consumer spending increased concerns regarding domestic economic growth.

The Bank of England continued tightening monetary policy while warning that the UK economy could face weaker growth conditions due to rising living costs and energy prices.

Japan

Japanese equities declined during April as global risk aversion increased and concerns regarding slowing international growth affected exporters and cyclical sectors.

The yen weakened sharply as the Bank of Japan maintained ultra-loose monetary policies despite rising global inflation and higher interest rates elsewhere.

Emerging Markets

Emerging markets faced significant pressure during April as rising U.S. interest rates, stronger dollar conditions and slowing Chinese growth reduced investor appetite for risk assets.

Commodity-exporting economies remained relatively supported by elevated raw material prices, though broader financial conditions tightened across many developing markets.

Commodities

Commodity prices remained elevated during April as geopolitical tensions and supply shortages continued disrupting global markets. Oil prices stayed high despite concerns regarding weaker Chinese demand caused by lockdowns.

Industrial metals weakened somewhat due to slowing Chinese economic activity, while gold prices remained relatively stable amid competing pressures from rising bond yields and geopolitical uncertainty.