March 2019

• Global markets were mixed in March 2019 as concerns over slowing global growth re-emerged despite supportive central bank policies.
• Major central banks, including the Federal Reserve and European Central Bank, adopted increasingly dovish tones in response to weaker economic indicators.
• Bond yields declined sharply, with parts of the U.S. yield curve inverting and raising concerns about recession risks.
• U.S. equities remained relatively resilient despite increased market caution.
• European and Asian markets experienced greater volatility due to softer manufacturing data and trade uncertainty.
• Commodity prices remained supported by supply constraints despite concerns over weaker demand growth.

Asia (ex. Japan)

Asian markets outside Japan experienced mixed performance during March as weaker Chinese manufacturing data and ongoing trade uncertainty weighed on sentiment. Although policymakers in China continued implementing stimulus measures, investors remained cautious regarding the pace of economic stabilisation.

Technology-focused markets such as Taiwan and South Korea experienced increased volatility amid concerns over slowing global electronics demand. India remained relatively resilient due to stable domestic consumption and supportive monetary conditions.

Europe

European equities weakened during March as economic indicators across the eurozone deteriorated further, particularly within Germany’s manufacturing sector. Investors became increasingly concerned about slowing global trade and weakening industrial activity.

The European Central Bank responded by delaying expectations for future interest rate increases and announcing additional liquidity support measures. Political uncertainty surrounding Brexit also continued weighing on investor confidence.

United States

U.S. equities remained relatively stable during March despite growing concerns about slowing global growth. The Federal Reserve adopted a significantly more dovish stance, signalling that no further interest rate increases were likely in the near term.

Treasury yields declined sharply, and parts of the U.S. yield curve briefly inverted, increasing market concerns regarding potential recession risks. However, employment and consumer spending conditions remained generally supportive.

United Kingdom

UK equities were mixed during March as Brexit-related uncertainty intensified ahead of the original withdrawal deadline. Sterling remained highly volatile in response to parliamentary votes and shifting political expectations.

Economic activity slowed modestly as businesses delayed investment decisions amid continued uncertainty. The Bank of England maintained its cautious stance while closely monitoring Brexit developments.

Japan

Japanese equities weakened modestly during March as slowing global trade and softer manufacturing conditions weighed on exporters. Investors remained cautious regarding external demand prospects and currency fluctuations.

The Bank of Japan maintained accommodative monetary policies while acknowledging increased downside risks to growth and inflation expectations.

Emerging Markets

Emerging markets delivered mixed performance during March as weaker global growth expectations offset supportive central bank conditions and improving trade negotiations.

Asian economies remained relatively resilient overall due to Chinese stimulus measures, while commodity exporters faced more challenging conditions amid concerns about slower global demand.

Commodities

Commodity prices remained relatively firm during March despite rising concerns about global growth. Oil prices continued benefiting from OPEC production cuts and supply disruptions.

Industrial metals were mixed as investors balanced Chinese stimulus optimism against weaker manufacturing conditions globally. Gold prices strengthened modestly due to increased safe-haven demand and falling bond yields.