FTSE All-Share Total Return (TR) GBP (%)*
The FTSE World Europe ex-UK Index returned 1.8% in sterling terms. The eurozone economy continued to recover strongly in June, with the eurozone’s composite Purchasing Managers’ Index reaching its highest level since 2006. The manufacturing activity component reached its best level on record as new export orders surged. Figures showed eurozone inflation had jumped to 2% in May versus 1.6% in April, though preliminary data for June suggested it had subsequently eased to 1.9%. The European Central Bank pledged to maintain its current pace of quantitative easing, indicating that it expected inflationary pressures to subside next year. Germany agreed a draft budget that will see it borrow an additional €100bn in 2022 as the country continues to grapple with the fallout from the coronavirus crisis and looks to support economic recovery.
FTSE World Europe ex UK TR GBP (%)*
The FTSE All-World North America Index returned 5.6% in sterling terms over June. US labour market data provided further evidence of a strengthening US economic recovery, with 559,000 jobs created in May versus April’s 278,000 tally. Unemployment eased to 5.8% compared with 6.1% in the prior month. Separate data showed that US inflation had soared to 5% in May from 4.2% in April against expanding consumer demand as the economy reopens. There was evidence that higher commodity prices, supply shortages and rising wages were feeding through to US consumer prices. However, investors opined that the inflationary spike would prove transitory, with 10-year US inflation expectations declining over June. Nevertheless, the Federal Reserve indicated it would likely begin to raise interest rates in 2023, having previously projected rate tightening to start in 2024.
FTSE All-World North America TR GBP (%)*
*Source: Lipper to 30June 2021, total return. Indices rebased to zero at 31 May 2021.
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