Global equities suffered one of their worst months in years in September, as aggressive monetary tightening weighed on investors’ minds. Markets fell below their previous year-to-date low in June and each of the first three quarters of 2022 have now delivered negative returns. The Federal Reserve delivered its third consecutive 0.75% interest rate hike as the ECB also moved higher. With inflation proving sticky, interest rate expectations remain elevated.

Economic growth is expected to slow from this point and leading indicators such as PMI data supports this perspective. Within equity markets, the focus now begins to shift toward the Q3 earnings season. Investor sentiment remains at a low level, with the American Association of Individual Investors survey showing bears outnumbering bulls by the largest margin since 2009.

Global sentiment was dealt another blow following the ‘mini-budget’ announcement from the new UK government which triggered volatility across UK bond and equities markets whilst sending Sterling into a brief tailspin against the US dollar. Intervention from the Bank of England briefly calmed markets, although the full fall out from the budgetary announcements remains to be seen.

For full details of last month's market movements you can download our monthly reports below.