D-PIMS Weekly Market Update - Week of 21st to 27th February 2022
Today’s Monday update:
Over the course of last week, market moving headlines were mostly political and Covid-19 related:
• On Monday, Prime Minister Boris Johnson said he would end all Coronavirus restrictions in England, including mandatory self-isolation for people with COVID-19 and free testing, drawing scepticism from some scientists and political opponents. Johnson said that the legal requirement to self-isolate for people who test positive for COVID would be removed on 24th February, while free universal testing would end on 1st April.
Australia on Monday fully reopened its international borders to travellers vaccinated against the Coronavirus. This comes after nearly two years of pandemic-related closings, as tourists returned and hundreds of people were reunited with family and friends.
• On Tuesday, British Health Secretary Sajid Javid told Sky News that Russia's invasion of Ukraine has already begun, so Britain will impose sanctions on Russia. This was in response to Russian President Vladimir Putin ordering the deployment of troops to two breakaway regions in eastern Ukraine, after recognising them as independent on Monday, accelerating a crisis the West fears could unleash a major war.
The Kremlin said on Tuesday it hoped Russia's recognition of two breakaway Ukrainian regions as independent would help restore calm and that Moscow remained open to diplomacy with the United States and other countries.. Russia denies any plan to attack Ukraine, but has threatened unspecified "military-technical" action unless it receives sweeping security guarantees, including a promise that its neighbour will never join NATO.
• The United States and its allies sought to step up sanctions pressure on Russia on Wednesday over the deployment of troops in separatist regions of eastern Ukraine, in one of the worst security crises in Europe in decades. The Ukrainian military said one soldier had been killed and six wounded in increased shelling by pro-Russian separatists using heavy artillery, mortar bombs and Grad rocket systems in the two breakaway regions over the previous 24 hours.
• On Thursday, Russia launched an all-out invasion of Ukraine by land, air and sea, the biggest attack by one state against another in Europe since World War Two and confirmation of the worst fears of the West. Russian missiles rained down on Ukrainian cities. Ukraine reported columns of troops pouring across its borders into the eastern Chernihiv, Kharkiv and Luhansk regions, and landing by sea at the cities of Odessa and Mariupol in the south. Explosions could be heard before dawn in the Ukrainian capital Kyiv. Gunfire rattled out near the main airport and sirens blared across the city.
• The Kremlin on Friday noted Ukrainian President Volodymyr Zelenskiy's willingness to discuss a possible neutrality pledge by Ukraine, but said it could not say anything about possible talks between the two countries' leaders. Later in the day, Kremlin spokesman Dmitry Peskov said it is ready to send a delegation to the Belarusian capital Minsk for talks with Ukraine.
Over the weekend, Russia’s attack on Ukraine continued and the Western countries stepped up sanctions, by barring some Russian banks from an international payments communication system (swift). They also closed most airspace over Europe to Russian aircraft.
• Over the week, the main Global Stockmarkets were down apart from the US which was slightly up. Markets were further affected by the breakout of hostilities in Ukraine and uncertainty over the direction this would take. Over the week, the D-PIMS Portfolios were down, especially the higher risk portfolios. They were helped by their China and Japan holdings, which fared best.
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The comments made above represent our interpretation of events and market views and are in no way a guarantee of future investment performance.