In April, UK investors withdrew £1.2 billion from fixed income funds, marking the swiftest bond outflows since the COVID-19 panic. The downturn was influenced by President Trump's tariff announcements, which incited fears of an economic slowdown. Amidst concerns over global market stability and potential interest rate cuts by central banks, investors responded by moving into equities, particularly North American stocks, which saw inflows of £1.5 billion. Despite redemptions, UK equities hinted at stabilization with slower outflows, while market volatility adversely impacted global M&A activity.
The sell-off came as President Trump's April 2 'Liberation Day' tariff announcement sparked global market volatility... raising fears of an economic slowdown.
The turmoil in US bond markets has pressured yields around the world... there are concerns about government finances if the global economy slows as much as predicted.
While bond funds suffered, investors flocked to equities, particularly North American stocks... net inflows into North American equity funds hit £1.5 billion.
UK equities, while still in outflow territory, showed signs of stabilisation... net redemptions slowing to £521 million.
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