March market performance: It’s no April fools’ – we're (almost) back in green

US 3.5%
The US region was the best performing in March, with a positive return of 3.5%. While the bank crisis began on the country’s west coast, the supportive actions of the government and central bank led to a positive market environment. Especially coupled with the belief that a struggling financial sector is going to lead to fewer and smaller interest rate increases before the rate has peaked and is moving down again.

Europe –0.5%.
The European region was the only one in minus for March. Europe is dealing with the uncertainty of whether the Credit Suisse debacle will lead to a larger crisis in the region’s financial industry, which has most recently led to Deutsche Bank having to answer for itself and its operations. Simultaneously, the region is experiencing civil disturbance with strikes in France, the UK and in other countries, while trying to balance green transformation and ramp up defence spending as a counter to Russia’s invasion of Ukraine.

Asia 2.6%, Emerging Markets 2.7%.
Asia and Emerging Markets posted good performance, mainly driven by Chinese activity picking up after the reopening of the economy seemed to aid the economic recovery in the country.

Information technology and communication services posted returns of 10 and 8.9 percent respectively and ended as the best performing sectors in March. One reason for that could be that they are – at least traditionally – some of the more rate-sensitive sectors, and thus the outlook of potentially fewer interest rate increases than expected will be appreciated. Unsurprisingly, the financial sector ended up as the worst performing, falling more than eight percent in March due to the bank crisis, followed by real estate and energy.

Bonds, both sovereign and corporate, posted positive returns in this infographic. On one hand, rates keep increasing and on the other, more investors seem to have rejoiced with the asset class as an investment object, meaning that demand may have increased for interest-bearing products like bonds.