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A SWOT Analysis will identify internal strengths, weaknesses, external opportunities and threats to each component of your insurance company or government risk pool's investment process.
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SAA Monthly Investment Update: November 2023View PDF
November was a positive month for both shares and bonds. Slowing inflation in the US and other regions gave rise to hopes that interest rates may have reached their peak. Growth stocks outperformed value. Commodities fell amid weakness in energy prices.
US equities advanced strongly in November. Gains were supported by the publication of October inflation data which showed that the consumer price index (CPI) reading had fallen to 3.2% year-on-year from 3.7% in September. The release raised hopes that inflation is on course to fall back to the Federal Reserve’s (Fed) 2% target, and that further interest rate hikes may not be needed. Economic data painted a mixed picture for the US economy. The second estimate of Q3 GDP showed an upward revision to 5.2% (annualized) compared to the first reading of 4.9% and growth in Q2 of 2.1%. However, data from the manufacturing sector showed weakness with the ISM manufacturing PMI indicating contraction with a reading of 46.7, unchanged versus October.
November was a positive month for fixed income markets. Government bonds, credit (both investment grade and high yield) and securitized assets all rallied amid growing speculation that central banks might be very close to ending rate hikes. Encouragingly, inflation pressures continued to ease as did concern around higher oil prices.