Global equities declined during the month with most indices ending the month in negative territory. The FTSE World index lost over 3.7% in Sterling terms and is down nearly 4.5% year to date. The US Dollar weakened over the month and the S&P500 lost over 4.3% in Sterling terms, but a little over 2.5% in local terms.
The relative strength of Sterling has also created a headwind for the FTSE 100, in part due to the large proportion of revenues that are generated overseas, and the index ended March at 7,056. This is around 9% lower than the recent peak in mid-January in capital terms. When income is added back the index has lost a little over 7% year to date. The FTSE All-Share Technology index in particular had a poor March, shedding nearly 19% of its value, but there was stronger performance in the FTSE All-Share Health Care and FTSE All-Share Pharmaceuticals & Biotechnology indices which were both up over 6% for the month.
The more speculative FTSE Emerging Markets index lost around 4.5% in March. Losses in the FTSE World Europe ex UK index, Asia Pacific ex Japan, and the FTSE Japan index were all around 3% for Sterling investors.
Yields on government bonds fell slightly during the month with the yield on the benchmark 10-year US Treasury now around 2.75%, whilst the 10-year Gilt yield is 1.35%. The FTSE Actuaries UK Conventional Gilts All Stocks index rose 2% in the last month but has gained less than 0.5% in the last 12 months on a total return basis.
Oil prices increased by over 5% in Sterling terms in March and are up over 21% over the last 6 months. However, over the longer term they have dropped nearly 50% in the last five years. Gold prices lost further ground during the month in Sterling terms and are down over 6% in the last year. The weakness of the US Dollar has contributed significantly to commodity price volatility and the gold price is up slightly in Dollar terms year to date.