First few months of 2021 may set the tone for the rest of this year

It is a year today since global equities generally bottomed out after COVID-19 sent shockwaves through financial markets. The markers in Chart 1 shows the returns since 23rd March 2020 from the 19 headline indices that we track on our Asset Allocation service. The blue bars show how the recovery in most “risky” assets was very strong until the end of 2020. The grey bars reveal, however, that it has run out of steam this year.