Omnis Agility update: March 2025
UK defies slowdown.
The FTSE 100 hit a record high, driven by falling inflation and expectations of rate cuts. Sterling also strengthened on better-than-expected GDP data. UK bond yields spiked before easing, reflecting shifting investor sentiment. Despite broader concerns, strong corporate earnings and improved confidence have kept UK stocks resilient.
US growth is slowing.
US stocks fell as rising inflation and new tariffs weighed on sentiment. Inflation climbed to 3% in January, reducing expectations of rate cuts. Job growth slowed, with 143,000 jobs added, while unemployment edged down to 4%. Markets remain cautious, with uncertainty over trade policy shaping Federal Reserve expectations.
Markets diverge on tariffs.
Trade tensions unsettled markets as the US imposed fresh tariffs and China retaliated. Trump confirmed a 25% tariff on Mexico and Canada. China responded with levies on $14 billion of US exports. European markets, however, rallied as the ECB cut interest rates to support growth.
Markets diverge on tariffs.
Trade tensions unsettled markets as the US imposed fresh tariffs and China retaliated. Trump confirmed a 25% tariff on Mexico and Canada. China responded with levies on $14 billion of US exports. European markets, however, rallied as the ECB cut interest rates to support growth.
Bonds offset equity losses.
Global bonds provided a silver lining for multi-asset investors, once again proving to be effective diversifiers against equity losses. While tariffs and stronger-thanexpected inflation data raised concerns, bond markets focused on weaker US sentiment and the growing risks to economic growth.
We remain cautiously positioned.
We have an overweight allocation to bonds and slight underweight in equities. Although stock markets have rallied, a weaker economy could put pressure on company revenues. Our central case remains falling inflation, a peak in the interest rate cycle and a soft landing, but with a larger than normal risk of a deeper recession.
Issued by Omnis Investments, which is authorised and regulated by the Financial Conduct Authority. Registered address: Auckland House, Lydiard Fields, Swindon SN5 8UB. This update reflects our view at the time of writing and is subject to change. The document is for informational purposes only and is not investment advice. We recommend you discuss any investment decisions with your financial adviser. Omnis Investments is unable to provide investment advice. Every effort is made to ensure the accuracy of the information but no assurance or warranties are given. Past performance should not be considered as a guide to future performance. Approved by Omnis Investments on 4 March 2025.
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