Most Major Asset Classes Rebounded In July
James Picerno | Aug 01, 2022 07:49AM ET
The majority of the major asset classes rebounded in July, providing relief from an extended run of red ink, based on a set of proxy ETFs. The challenges that triggered widespread selling in global markets this year remain in force—the war in Ukraine, high inflation, rising interest rates and stumbling economic activity. This toxic mix will continue to create headwinds for markets, but for one month, at least, gloomy sentiment took a holiday.
US stocks (Vanguard Total Stock Market Index Fund ETF Shares (NYSE:VTI)) led the revival, jumping 9.3% last month—the first monthly gain since March. Despite a strong monthly bounce, American shares remain deep in the red year to date: VTI is in the hole by 14% in 2022.
Although most markets around the world rose last month, there was no relief for stocks in emerging markets (Vanguard FTSE Emerging Markets Index Fund ETF Shares (NYSE:VWO)), which edged down 0.8% in July. Commodities (iShares S&P GSCI Commodity-Indexed Trust (NYSE:GSG)) and emerging markets government bonds (VanEck J.P. Morgan EM Local Currency Bond ETF (NYSE:EMLC)) also lost ground.
The Global Market Index (GMI) joined the relief rally in July. This unmanaged benchmark (maintained by CapitalSpectator.com), which holds all the major asset classes (except cash) in market-value weights, rose 6.6% last month, although this portfolio-strategy benchmark is still off by nearly 14% so far in 2022.
Comparing GMI’s performance to US stocks and bonds over the past year illustrates the strength of revival in July in relative terms. The strong rebounds look encouraging, but it’s not yet clear if the downside trendlines have run out of road.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.