Equities

US markets whipsawed, rallying on Friday after volatility followed the US Federal Reserve (Fed) meeting. Shares in Europe fell for the fourth consecutive week, on interest rate uncertainty and rising tensions between Russia and Western Europe. Japan’s main indices were also hit by fears of tighter policy, with the high growth tech sector most impacted. Chinese equities fell sharply ahead of this week’s Lunar New Year holiday.

Bonds

US Treasury bond yields reversed their earlier climb, as prices rallied late in the week. European government bonds were generally weaker on concerns over inflation and interest rates. Investment grade corporate bonds responded negatively to the Fed meeting, although energy sector bonds outperformed. High yield corporate bonds traded lower, as the prospect of tighter Fed policy weighed on risk assets.

Currencies

The US dollar gained against all majors, while the euro weakened across the board. Sterling advanced slightly against the yen, which only managed gains against the Euro.

Commodities

The oil price touched $90 as geopolitical tensions mounted on the Ukrainian border. Meanwhile, gold and industrial metals slipped back somewhat.

Responsible investing

The UK announced that airlines would be required to fly more regularly, in order to keep their airport landing rights, prompting warnings of pollution by half empty ‘ghost flights’.