2023-08-01

Monthly report July 2023

Despite intense news flow with company reports, interest rate announcements from central banks and economic statistics, activity in the financial markets fell during the month when the usual summer lull arrived. All our fixed income funds performed well in this climate, and for the equity funds, Simplicity Fastigheter developed very positively after good company reporting by the companies that have reported so far.

Summary of the market’s focus during the month:

Slowing Swedish economy
Swedish GDP fell by 1.5% in the second quarter and by 2.4% over the past year. The figures were significantly lower than both the market’s and the Riksbank’s forecasts. The number of bankruptcies continued to rise and reached record levels in June. It is mainly companies in the retail, construction and restaurant sectors that have been affected, and this can largely be explained by lingering effects from the pandemic.

Continued hikes
A number of central banks, including the Fed, ECB and Bank of Canada raised their key interest rates in line with expectations. Both the US and European central banks underlined that their future actions will depend on incoming data. This was well received by markets, which hope that the rate hike cycles are coming to an end. The members of the Riksbank remain concerned about high inflation and the weak Swedish exchange rate, which is considered to have increased the likelihood of further hikes by the Riksbank.

Strong company reports for the second quarter
The companies’ reports for the second quarter of 2023 have shown continued strong development for most companies. However, expectations are high and tolerance for deviations has been low and the negative price reactions to weak reports have in many cases been large. The major Nordic banks reported strong results with low credit losses, and it is also interesting to note that most banks chose to downplay the risk of their loans to commercial real estate companies.

The development of fixed income funds

Simplicity Likviditet: +0.40%

Simplicity Nordic Corporate Bond EUR: +0.68%

Simplicity Global Corporate Bond: +1.07%

Simplicity High Yield:+0.99%

Read our fixed income newsletter here.

The development of equity funds

Norden: -1.4%

Sverige: -1.0%

Småbolag Sverige: -3.4%

Småbolag Global: -0.7%

Fastigheter: +11.0%

Green Impact: -0.9%

Read our equity newsletter here.

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4 July

Monthly report June 2023

A eventful and volatile June, which saw continued interest rate hikes to combat inflation, resulted in mixed performance for our equity funds. All bond funds performed positively driven by the funds’ continued high interest rates. Summary of the market’s focus during the month:  Continued uncertainty about the economic outlook The uncertainties surrounding the economic development […]

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1 June

Monthly report May 2023

The reporting season has largely ended and the prevailing picture of strong earnings from companies is intact. The credit markets performed relatively strongly in May and all funds generated positive returns, while equity funds diverged. Summary of the market’s focus during the month:  Agreement on US debt ceiling in place After a period of intense […]

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