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LCP Investment Summary December 2020
Posted on 6 January, 2021 by Administrator
Global equity markets rose 2.4% in December and 6.7% for 2020 (both in € terms), to finish what was an extraordinary year for investors.Despite the continuing rise in Covid cases globally, the emergence of new strains and increased restrictions in many countries, investors looked to the positives with the start of vaccinations in both the U.S. and Europe.
Investors also welcomed the $900bn emergency economic aid package eventually agreed upon the U.S. Senate. In addition, the package included $1.4trn to fund government agencies preventing a federal government shutdown. Markets reacted favourably as the EU and U.K. finally agreed upon a post-Brexit trade deal.
Longer-dated Eurozone bond prices rose 0.1% in December, with the yield on the AAA Eurozone 15+ Year Index falling to -0.28% by month-end. The Euro Broad Sovereign 10+ Year Index rose by 0.3% with its yield falling to 0.30%.
Despite some optimism for economic growth in 2021/22, longer-dated AAA yields fell slightly over the month as the ECB announced that it would increase the overall size of its ‘Pandemic Emergency Purchase Programme’ by €500bn to €1.85trn. ECB chief Christine Lagarde also noted that inflation remained ‘disappointingly low’.
Sample DC Schemes
Our three sample DC Strategies all rose in December.