Q4’22 commenced with heightened recessionary angst, as intensified geopolitical risks sustained energy-induced inflationary pressures and provided fodder for increased monetary hawkishness. Nonetheless, akin to July 2022, equity investors’ sentiments were lifted by expectations for a slowdown in the pace of monetary tightening and improvement in global supply chain (aided by progress in the execution of the Russia-Ukraine grain deal).

To wit, the MSCI World Index rose by 7.1% MoM in October, with US equities benefitting from resilient consumer spending that propelled GDP growth (+2.6% QoQ) in Q3’22. Elsewhere, the UK and mainland European markets were buoyed by Rishi Sunak’s emergence as British prime minister and fiscal announcements by the EU to counteract higher energy prices. In contrast, the MSCI Emerging Markets Index tumbled by 3.2%, succumbing to pressures from the Orient. With political externalities exacerbating the impact of an already depressed real estate sector, Chinese markets suffered another monthly deterioration.