November 2015

• Global markets were broadly positive in November 2015 as expectations for further European Central Bank stimulus and improved U.S. economic data supported risk assets.
• European equities rallied strongly following signals that the ECB would expand its quantitative easing programme in December.
• U.S. markets were mixed but generally stable as investors balanced solid domestic growth against uncertainty over the timing of Federal Reserve rate increases.
• Japan advanced on continued monetary support and a weaker yen, while China stabilised after earlier volatility.
• Emerging markets posted gains as commodity prices recovered modestly and global risk sentiment improved.
• Commodity markets were volatile but ended the month higher, led by a rebound in oil prices.

Asia (ex. Japan)

Asian markets outside Japan posted gains in November as investors responded positively to expectations of further policy easing in Europe and continued stimulus efforts in China. Chinese equities remained volatile but stabilised compared with the sharp swings seen earlier in the year, supported by ongoing monetary and liquidity measures from policymakers.

Across the region, lower expectations for imminent U.S. rate increases helped ease pressure on currencies and capital flows. India continued to stand out as a relatively strong performer, supported by subdued inflation and steady reform momentum, while export-oriented economies such as South Korea and Taiwan benefited from improved global risk sentiment.

Europe

European equities were among the strongest global performers in November as investors increasingly anticipated an expansion of the European Central Bank’s quantitative easing programme. The prospect of additional monetary stimulus drove the euro lower and boosted expectations for corporate earnings growth.

Economic data remained mixed but showed signs of gradual improvement in credit conditions and business sentiment. Sovereign bond yields remained low, and equity markets were supported by abundant liquidity and improving investor confidence ahead of the ECB’s December policy meeting.

United States

U.S. equities were relatively steady in November as strong labour market conditions and solid consumer spending supported the economic outlook. However, uncertainty surrounding the Federal Reserve’s December meeting created some caution among investors.

Corporate earnings were broadly resilient, although energy-related sectors continued to struggle due to lower oil prices. Treasury yields rose modestly as markets increased expectations for a near-term interest rate hike, reflecting growing confidence in the underlying strength of the U.S. economy.

United Kingdom

UK equities delivered modest gains in November as domestic economic conditions remained stable and global risk sentiment improved. Low inflation continued to support household incomes, while employment growth remained positive.

The Bank of England maintained its accommodative stance, with inflation well below target and limited pressure for immediate policy tightening. Sterling was relatively stable, while gilt yields moved slightly higher in line with global bond markets as expectations for future rate increases gradually strengthened.

Japan

Japanese equities advanced in November, supported by ongoing monetary stimulus from the Bank of Japan and a weaker yen. Exporters benefited from improved competitiveness, while corporate governance reforms continued to support shareholder returns and investor confidence.

Economic indicators suggested a slow but steady recovery, although inflation remained subdued. Expectations for additional policy action remained in focus, helping sustain positive sentiment across equity markets.

Emerging Markets

Emerging markets posted gains in November as improved global risk appetite, stabilising commodity prices and a softer U.S. dollar supported sentiment. Countries with stronger domestic fundamentals and reform progress continued to outperform more vulnerable commodity-dependent economies.

India remained a standout performer, while several Asian markets benefited from improved liquidity conditions. Latin American markets showed early signs of stabilisation, although political uncertainty and economic challenges persisted in key economies.

Commodities

Commodity markets recovered modestly in November after earlier declines. Oil prices rebounded on expectations of stabilising demand and speculation that supply growth could moderate in response to lower prices and reduced investment activity.

Industrial metals also improved slightly as Chinese stimulus measures supported sentiment. Gold prices were relatively stable, balancing stronger expectations of U.S. rate increases against ongoing geopolitical and economic uncertainty.