Share Markets
Global share markets rose 3.7% in May, reverting to their upward trend
Favourable economic data in the US, UK and Europe, a successful US earnings season, and falling longer term interest rates supported the rise in global share markets.
AI remains a key feature. Nvidia’s better than expected profit announcement provided a big boost for global share markets, being used by investors as a gauge of the AI boom.
New Zealand’s share market fell -0.9%, reflecting disappointing earnings updates from several companies, echoing a challenging domestic economy.
Australian equities rose 0.9% in May primarily on global developments with domestic factors mixed.
Fixed Income / Bond Yields / Interest Rates
Global bond yields fell on favourable inflation outcomes and softer than anticipated US economic data.
New Zealand’s longer-term interest rates drifted lower on global events and despite the RBNZ policy statement indicating short-term interest rates will need to be held higher for longer.
Fixed income offers an attractive yield with the potential for capital gains from declines in interest rates.