image image

Multi-asset chart of the week

Multi Asset chart of the week

09 June 2026 Multi-asset
Week to 12 June 2026

Real rate moves getting to extremes: equities are sensitive to the pace of changes in real rates

Stephanie Chan, CFA, Portfolio Manager, said: “Rates of change often matter more than levels, and if real rates rise too rapidly this tends to result in negative subsequent returns for US equities. With elevated inflationary pressures, rates markets are starting to price in the potential impact on both monetary and fiscal policy. The current pace of increase in the US 10-year real rate (3-year z-score is currently 1.3) has historically still been positive for subsequent US equity returns. However, if this rate of change increases further it will be a negative signal for equities. On average, subsequent equity returns have historically been negative when the real rate z-score is greater than 2.”

1COW0906 (2).png 3COW0906.png

Source: Insight Investment, Bloomberg as at 09 June 2026.

Week to 05 June 2026

Chips mania: outperformance of the tech sector has helped to buoy global equity markets

Christopher Broadley, CFA, Portfolio Manager, said: “The MSCI World information technology sector has rallied more than 30% since the start of the Iran war. This has been driven, in part, by strong earnings reports from tech companies, as well as by expectations that the strong demand for chips and AI infrastructure will continue. The performance of the tech sector has clearly diverged from the performance of sectors such as consumer staples and healthcare, both of which have lost almost 10% since the start of the war. These sectors may likely be more negatively impacted by increased inflation pressures caused by the energy supply shock. While equity markets seem buoyant despite the Iran war, there is indeed significant dispersion between sectors and fears around the impact of inflation continue to be reflected in specific pockets of the market.”

3COW05052026.png

 

Source: Insight Investment, Bloomberg as at 02 June 2026.

Back to top