The fact that Russian tanks are entering the streets of Donetsk means that there is a risk of escalation and that things could easily spiral out of control.

US equity large-cap indexes suffered their 2nd consecutive week of declines as high inflation and worries over a Russian invasion of Ukraine weighed on sentiment.

Below are answers to our Client’s most frequently asked questions (FAQs) on inflation, the Fed, FOMC minutes, Russia/Ukraine, our portfolio positioning and Gold as a hedge. 

It was another volatile week for risk assets. US large-cap equity indexes ended the week lower with the Nasdaq faring worse. Healthy earnings growth was offset by fears over monetary tightening.

Equity markets remained volatile but recorded overall gains for the second consecutive week. It was one of the busiest weeks of the Q4 earnings reporting season, with 112 companies in the S&P 500 Index scheduled to report results.

Late gains helped the US main stock benchmarks to close in positive territory for the week after they briefly hit correction territory (down more than 10% from recent highs). The small-cap Russell 2000 Index lagged and ended the week down nearly 20% from its November peak, leaving it just outside of a bear market.

Facing both surging inflation and volatile financial markets, the Federal Reserve on Wednesday said it could soon raise interest rates for the first time in more than three years, as they are normalizing their monetary policy.

Please find below answers to our Client’s most FAQs (frequently asked questions) on current market turmoil, our portfolio positioning, upcoming Fed meeting and Russia / Ukraine risk.

Rising interest rate fears and growth worries pushed the S&P 500 Index to its biggest decline since October 2020. US small caps and the Nasdaq declined the most.

Inflation and rate worries weighed on US equity large-caps indices as earnings season begins. The technology-heavy Nasdaq Composite recorded its third consecutive weekly loss.