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D-PIMS Weekly Market Update - Week of 31st January to 6th February 2022

Today’s Monday update:

Over the course of last week, market moving headlines were mostly political, Covid-19 and economically related:

• North Korea confirmed on Monday it had launched a Hwasong-12 ballistic missile, the same weapon it had once threatened to target the U.S. territory of Guam with, sparking fears the nuclear-armed state could resume long-range testing. North Korea has said it is open to diplomacy, but that Washington's overtures are undermined by its support for sanctions and joint military drills and arms build-ups in South Korea and the region.

An inquiry into COVID-19 lockdown-breaking parties at Prime Minister Boris Johnson's office and residence said on Monday that some of these should not have taken place, and serious failures of leadership and judgment occurred at the heart of the British government.

• Russian President Vladimir Putin accused the West on Tuesday of deliberately creating a scenario designed to lure it into war, and ignoring Russia's security concerns over Ukraine. In his first direct public comments on the crisis for nearly six weeks, a defiant Putin showed no sign of backing down from security demands that the West has called non-starters and a possible excuse to launch an invasion, which Moscow denies.

• The world's first "human challenge" trial in which volunteers were deliberately exposed to COVID-19 to advance research into the disease was found to be safe in healthy young adults, leaders of the study said on Wednesday. The data supports the safety of this model and lays the groundwork for future studies to test new vaccines and medicines against COVID-19, using this kind of trial by the end of this year, the team added. Open Orphan (ORPH.L) is running the project, launched last February, with Imperial College London, Britain's vaccines task force and Orphan's clinical company hVIVO. Scientists have used human challenge trials for decades to learn more about diseases such as malaria, flu, typhoid and cholera, and to develop treatments and vaccines against them.

• Data showed on Thursday, that the number of people going out to restaurants in Britain jumped last week, after the lifting of Coronavirus-related restrictions in England. There were also increases in spending on credit and debit cards and in visits to shops. Online restaurant bookings via OpenTable in the week to 31st January were 106% of their level in the same week of 2020, up 9% on a week earlier.

On Thursday, Britain approved the COVID-19 vaccine developed by Novavax for use in those aged 18 and older, bringing a fifth Coronavirus vaccine to its roster. The vaccine, Nuvaxovid, was approved as a first and second dose after meeting the required safety, quality and effectiveness standards, the UK's Medicines and Healthcare products Regulatory Agency (MHRA) said in a statement.

The Bank of England has raised interest rates for the second time in three months in a bid to cool soaring prices. The increase to 0.5% from 0.25% comes as households face soaring energy bills and rising costs to the weekly shop. The pound jumped by around two-thirds of a cent against the dollar to above $1.36. British government bonds sold off, with the 10-year yield hitting its highest level since January 2019.

• According to preliminary industry data released on Friday, British new car registrations rose by more than 25% in January compared with the same month last year. The Society of Motor Manufacturers and Traders (SMMT) said private registrations were up by about 60% and one in five buyers opted to purchase an electric vehicle last month.

Russia and China called in a joint statement on Friday for NATO to halt its expansion, while Moscow said it fully supported Beijing's stance on Taiwan and opposed Taiwanese independence in any form. The joint statement, including harsh criticism of the United States, was issued during Russian President Vladimir Putin's visit to China for the Winter Olympics. The Kremlin said Putin and Chinese President Xi Jinping held warm and substantive talks in Beijing and described the relationship as an advanced partnership with a special character.

In the U.S, Nonfarm payrolls increased 467,000 in January after an upwardly revised 510,000 gain in December, a Labour Department report showed Friday. The unemployment rate ticked up to 4%, and average hourly earnings jumped. The median estimate in a Bloomberg survey of economists called for a 125,000 advance in payrolls, though forecasts ranged widely.

• Over the week, the main Global Stockmarkets, were up, especially China and the Far East. Markets were encouraged by good company results and economic measures. Over the week, all the D-PIMS Portfolios were up, especially the higher risk Portfolios. They were helped by their diversity and U.S exposure.


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Past Performance is no guarantee of, or guide to future returns.

The comments made above represent our interpretation of events and market views and are in no way a guarantee of future investment performance.