April 2024 Market Summary

What a month April turned out to be for the FTSE 100 as shares were lifted by hopes of interest rate cuts this year and an easing of geopolitical tensions.

The FTSE 100 reached record highs in April!

April proved to be a fruitful period for HSBC shareholders with the stock rising 10.5%. Other top FTSE risers were Primark owner Associated British Foods, up by 9%, JD Sports, up by 6% and Ocado, up by 5%. This was a big comparison to the S&P 500 which marked its first monthly decline this month since October 2023.

Mortgage Rates

In May 2024, mortgage rates on fixed rate mortgages increased in the UK again, prompted by the expectation of the Bank of England making fewer and slower interest rate cuts.

Back in March 2024, the Bank of England held the base rate at 5.25% for the fifth time in a row. Financial markets are currently predicating the first cut in interest rates will be in June or August 2024.

Any cuts in interest rates depend on factors such as what happens with inflation. While inflation has fallen during the last year, the annual inflation rate stood at 3.2% in April 2024, which is above the Bank of England’s 2% target.

Geopolitical Tension

Geopolitical tension remains a key driver of market volatility. The ongoing conflict in certain regions contributed to fluctuations in oil prices, impacting energy markets.

In addition to this, concerns about supply chain, trade disputes, diplomatic tensions between major economies all contributed to investor uncertainty leading to fluctuations in commodities, currencies, and equities.

In summary…

Ongoing uncertainty regarding geopolitical tensions and potential fluctuations in energy and commodity markets could continue to impact investor confidence. The outlook remains contingent upon factors such as the Bank of England’s policy decisions and inflation trends, which may influence market dynamics in the coming months.

Despite these uncertainties, the FTSE 100 demonstrated resilience and strength, offering investors reason for cautious optimism as the year progresses.

If you’d like to discuss any of this with your Financial Planner, please contact us.

Please note for this monthly summary, we focus on the major indices within the financial markets such as the FTSE 100 (UK) and the Dow Jones and NASDAQ (US) to provide a factual account of what has happened within a certain index. The performance figures quoted are factual from the month’s trading and this summary is for commentary purposes only.

The performance of these indices is not a representation of an individual fund or portfolio. Past performance is no guarantee of future returns. The value of your investment can go down as well as up. You could get back less than you originally invested.