Recovery and a positive end of year?

In this update:
- Recovery through the prospect of falling interest rates
- Remaining uncertainty due to conflicts
- Stock market valuations look fair again

Recovery due to the prospect of falling interest rates

After the unexpectedly sharp rise in interest rates had put pressure on both equities and bond markets, it is now expected that interest rates could fall again as early as 2024. This would boost the economy. Stock markets have risen due to the more positive outlook. Now most markets are showing a plus for the course of 2023.

In the past, the financial markets have frequently performed well in the final months of the year (this is known as a "year-end rally"). Without further "bad news," there is hope that the markets will have a conciliatory end to the year.

Uncertainty due to conflicts and China's stuttering growth engine

The war in Ukraine and the conflict in the Middle East continue to cause uncertainties and therefore weigh on the financial markets.

China has become a question mark. The economy has not yet recovered from the slowdown during the Covid crisis and the important real-estate sector is in crisis.  On the positive side, it should be noted that this lower growth is heavily priced into the Chinese stock markets. Therefore there is catch-up potential on the Chinese stock markets in case of a slight recovery.

Assessment of the financial markets and Selma's reaction

In general, the financial markets around the world are currently fairly valued and there are signs that the recovery after the very negative stock market year 2022 could continue.  Selma is therefore slightly reducing its investments in gold and silver and investing a little more in the global equity markets.

True to our investment approach, we believe that in this market environment, it continues to make sense to take a diversified, long-term view and stick to your plan in order to take advantage of opportunities without ignoring the risks.

YTD Performance

Within the Selma mobile app, you also see the YTD performance as an additional analysis option. YTD stands for "Year to date", i.e. it shows you the performance during the current year or how your investments have developed in 2023. 

We have compiled our tips for comparing performance in this blog article.