Market update

Continued enthusiasm for AI and a US-China trade deal easing tariffs and rare-earth limits boosted global equities for a second month in October.

Global equities moved higher in September with most major indices making positive returns, with US equities leading the way returning 4% (in sterling terms). This meant it was another strong quarter for risk assets as market enthusiasm around AI gained momentum, trade tensions were eased and we saw the Federal Reserve cut rates for the first time since December 2024.

Following a strong run in May and June, markets maintained their upward momentum in July, with risk assets once again delivering healthy returns. While concerns around inflation and government borrowing remain, investors found several reasons to stay positive on the outlook.

It was another eventful quarter for investors, marked by shifting trade policies and heightened geopolitical risks in the Middle East. Despite this, markets remained resilient as the worst-case scenarios, failed to materialise.

The old adage “Sell in May and go away” didn’t hold true this year. Markets delivered strong returns in May and was a reminder that staying invested through uncertainty can be rewarding.