July 2022

• Global markets rebounded in July as investors anticipated that slowing economic growth could eventually reduce the pace of central bank tightening.
• Technology and growth stocks recovered strongly following sharp declines earlier in the year.
• Inflation remained elevated globally, though some commodity prices began easing from peak levels.
• Central banks continued raising interest rates aggressively to combat persistent inflation pressures.
• European economies faced increasing energy supply risks linked to the war in Ukraine.
• Emerging markets delivered mixed performance amid slowing global growth and shifting monetary expectations.

Asia (ex. Japan)

Asian markets outside Japan delivered mixed but generally improved performance during July as Chinese authorities introduced additional stimulus measures to support economic recovery following earlier lockdown disruptions.

Technology-focused markets such as Taiwan and South Korea rebounded alongside recovering global semiconductor sentiment, though concerns regarding weakening export demand and slowing global growth persisted.

Europe

European equities recovered modestly during July despite ongoing concerns regarding energy shortages, inflation and slowing economic activity. Investors responded positively to signs that commodity price pressures could gradually ease.

The European Central Bank raised interest rates for the first time in more than a decade as inflation reached record levels across the eurozone.

United States

U.S. equities rebounded strongly during July as investors anticipated that slowing economic growth and weakening consumer demand could eventually reduce the pace of Federal Reserve tightening.

Technology stocks led gains following significant first-half declines, while corporate earnings generally proved more resilient than feared despite slowing economic momentum.

United Kingdom

UK equities delivered relatively stable performance during July as energy and defensive sectors helped offset concerns regarding slowing domestic growth and rising inflation.

Political uncertainty increased following the resignation announcement of Prime Minister Boris Johnson, while the Bank of England continued signalling further interest rate increases ahead.

Japan

Japanese equities advanced during July as weaker yen conditions continued supporting exporters and improving competitiveness for manufacturing companies.

The Bank of Japan maintained ultra-loose monetary policy despite rising inflation globally, helping support domestic financial conditions and equity sentiment.

Emerging Markets

Emerging markets delivered mixed results during July as easing commodity prices reduced inflation pressures somewhat, though slowing global growth continued weighing on investor confidence.

Asian economies benefited from Chinese stimulus measures and improving technology sentiment, while commodity-exporting nations faced more mixed conditions as raw material prices moderated.

Commodities

Commodity prices weakened somewhat during July as recession fears and slowing demand expectations increased across global markets. Oil prices remained volatile but eased from earlier highs due to concerns regarding economic slowdown.

Industrial metals also weakened due to softer Chinese growth and manufacturing activity, while gold prices remained relatively subdued amid rising interest rates and stronger dollar conditions.