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Market news today – Shares reset continues – Fidelity International

WHAT’S the right level for the stock market in an environment of high inflation, rising interest rates and slowing growth? That’s the question that’s been preying on investors’ minds for a few weeks now.

Volatility has been high too, as investors have toyed with buying the dips but quickly lost their nerve and bailed out again.

No wonder expectations of UK rate rises – they also edged higher to 1% last week – are starting to lag behind those in the States.

The core picture, excluding energy and food, may be more worrying, as rents continue to rise, but it would still be a welcome reminder that inflation doesn’t keep rising for ever.

The second bit of good news is that the poor economic backdrop is not yet showing through in corporate earnings, which remain the key determinant, alongside valuations, of where the stock market should be trading.

That should help offset any further reduction in valuation multiples which have been falling for over a year now as investors anticipated slowing profits growth.

If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice.

This website is issued by Financial Administration Services Limited, which is authorised and regulated by the Financial Conduct Authority and registered in England and Wales under company number 1629709 whose registered address is Beech Gate, Millfield Lane, Lower Kingswood, Tadworth, Surrey, KT20 6RP.

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