Hier.pdf

Global equity markets experienced a sudden correction in January 2022 due to rising inflation and geopolitical risks, with investors shifting from growth stocks to value stocks. The US Federal Reserve's announcement to end accommodative monetary stimulus and raise interest rates led to a market regime change, with investors focusing on inflation-backed assets. Emerging markets have been affected by slowing growth, rising inflation, and currency devaluation, but some countries such as China and Vietnam have shown financial stability. The FY2021 reporting season has highlighted key themes including supply chain disruptions, labor shortages, and net zero pledges, with companies reviewing their business models and investing in IT for productivity gains. Investors are increasingly focusing on earnings quality, operational leverage, and cost base affected by inflation, as well as ESG factors such as employee engagement and diversity.