Monthly market summary – Review of November 2024

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Our market summary

The US election result was the main driver of market performance in November. Donald Trump regained the presidency, and the Republicans retained the Senate and won the House of Representatives. This clean sweep could make it easier for Trump to implement his campaign promises that include tax cuts, trade tariffs, and the deportation of illegal migrants.

Against this backdrop, global equities were up 5.0% in November. However, there remains a high degree of uncertainty about US domestic and foreign policy, and what the policy responses of other countries will be.

US

US equities significantly outperformed all other regions, returning 7.5% in November, buoyed by expectations that Trump’s domestic policy will cut taxes and regulation. It was these expectations for de-regulation that boosted US financials and the energy sector, while the industrials sector was seen as one of the main beneficiaries from tax cuts and trade policy. The weakest sectors in the month included healthcare and materials.

Europe

European equities were down 1.4% over the month with concerns about US trade policy and earnings warnings from the automotive and consumer goods sectors weighing on sentiment. The IT and communication services sectors were among the top gainers while materials and consumer staples suffered some of the steepest declines. There was also political uncertainty as the German government collapsed and then the French government followed in December.

UK

UK equities were up 2.4% in November. Strong performance from financials and domestically focused companies helped to recoup some of the losses suffered in the immediate wake of the October Budget. Sterling also weakened 1.1% against the dollar which boosted companies with significant US exposure. However, economic headwinds increased as GDP growth in Q3 2024 was reported to have slowed to 0.1% from 0.5% in Q2 2024.

Emerging markets

Overall, emerging markets equities were down by 2.5% in November as they weakened in the face of a strengthening dollar and investor concerns about the impact of Trump’s intended tariffs. The latter weighed particularly heavy on China, which was down 3.3%. Elsewhere, some of the smallest emerging markets, such as the Philippines and Indonesia, saw the biggest losses, whilst the European markets of Czech Republic, Hungary, and Turkey were the top performers.

Fixed income

Fixed income markets ended the month on a positive note, despite earlier volatility surrounding the US elections. Global bonds were up 1.2% and global corporate bonds returned 1.4%. In the UK, gilts rallied and ended the month up 1.8%, whilst US Treasuries were up 0.8%. Meanwhile, central banks continued to lower rates during November with both the US Federal Reserve (Fed) and the Bank of England cutting interest rates by 0.25%.

Source: Quilter Investors and Factset as at 30 November 2024. Total return, percentage growth, rounded to one decimal place over period 31 October 2024 to 30 November 2024. Global equities is represented by the MSCI AC World Index, US equities by the MSCI USA Index, European equities by the MSCI Europe ex UK Index, UK equities by the MSCI United Kingdom All Cap Index, emerging markets by the MSCI Emerging Markets Index, Chinese equities by the MSCI China Index, US Treasuries by the ICE BofA US Treasury (GBP Hedged) Index, gilts by the ICE BofA UK Gilt Index, global corporate bonds by the Bloomberg Global Aggregate Corporate (GBP Hedged) Index, and global bonds by the Bloomberg Global Aggregate (GBP Hedged) Index.

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Marcus Brookes

Chief Investment Officer & Managing Director

Marcus is chief investment officer and managing director of Quilter Investors. Marcus joined Quilter Investors in December 2021 from Schroders Personal Wealth, where he also held the role of chief investment officer. He has considerable investment management experience with a deep understanding of the multi-asset sector having managed multi-manager fund ranges for more than 20 years.

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