Umbra’s November 2024 MPS review reflects strong global equity performance, driven by the US election and robust macro data. Trump’s victory boosted US markets and risk sentiment, while UK conditions remained fragile with stagflation risks. Umbra MPS portfolios outperformed ARC benchmarks across risk levels, benefiting from international equity exposure, EM debt, and alternatives. Despite gold weakness and political uncertainty in Europe, diversified strategies positioned Umbra’s MPS range well for year-to-date gains.
November 2024 saw global markets dominated by the US election outcome. Donald Trump’s victory, coupled with Republican control of Congress, set the stage for pro-growth policies, tax cuts, deregulation, and protectionist trade stances. Markets rallied strongly, with the S&P 500 recording its largest post-election daily gain on record and delivering its best monthly return of the year. Financials, consumer discretionary, and small caps led gains, while interest rate-sensitive sectors lagged on inflation concerns.
In contrast, the UK outlook remained weak. Higher taxes, wage pressures, and slowing activity data point to stagflation risks into 2025. European equities also underperformed, dragged down by political instability in Germany and France, tariff fears, and weak Chinese demand for European exports. Emerging markets struggled against a stronger US dollar, with Latin America particularly weak.
Fixed income saw rate cuts of 0.25% from both the Federal Reserve and the Bank of England, though Trump’s win clouded the outlook for further easing. US Treasury Secretary-designate Scott Bessent’s pledge to reduce deficits supported bond markets, while EM hard currency debt posted strong returns. High yield bonds also performed well on the back of corporate strength. Alternatives were mixed: infrastructure (+4.5%) and property (+2.3%) were buoyed by falling rates, while gold fell –3.7% as the dollar rallied.
The Umbra MPS range once again outperformed ARC benchmarks across risk profiles, with YTD returns running ahead of peers. Performance drivers included strong US equity exposure, EM debt gains, and alternative allocations. Returns in November ranged from +2% in Defensive portfolios to nearly +5% in Equity portfolios, underlining the benefits of diversification and disciplined management. Umbra’s international exposure continues to offset the UK’s more challenging economic outlook, positioning the MPS range for resilience as markets navigate shifting political and policy landscapes.
