According to Bloomberg, markets cratered on Friday. Whilst I’m not entirely sure what cratering means, it can’t be all that good as the S&P 500 lost 1.7% and the Nasdaq 100 entered a correction with a loss of more than 10% from its last record. As the conflict in the Middle East continues unabated and the White House sends mixed signals about the status of the war, investors have grown increasingly concerned that higher oil prices will lead to faster inflation and cripple the global economy.
Brent crude oil jumped to $112 a barrel as Iran continued to turn away tankers from the Strait of Hormuz. Higher fuel prices are stoking inflation worries — economists raised US inflation estimates to 3% this year — and undercutting the case for the Federal Reserve to lower interest rates anytime soon. That has helped push up Treasury yields this week.
Among S&P 500 sectors, consumer discretionary stocks were among the biggest losers, with the group falling more than 3%, while the communications, technology and financial sectors were down more than 2%. The broader index itself was off nearly 9% from its late January record, nearing correction territory. Meanwhile, US consumer sentiment tumbled to a three-month low on Friday.
The UK is facing the biggest hit to growth from the Iran war out of the G20 major economies, according to an influential global policy group. Economic growth in the UK this year is forecast to be 0.7%, the Organisation of Economic Co-operation and Development (OECD) said, down from its previous forecast of 1.2%. Inflation is also predicted to be higher than expected. The OECD has downgraded forecasts for many of the world’s biggest economies due to the US-Israel war with Iran.
The latest UK inflation figures already look dated, capturing a February backdrop that has since been overtaken by a sharp deterioration in the global energy outlook says IFA Magazine. While price growth appeared to be easing in line with expectations, escalating conflict in the Middle East has since driven a renewed surge in oil and gas prices. This shift matters because domestic pressures were already proving sticky, with services inflation, wage growth and input costs all holding firm. The result is a less benign outlook for the Bank of England, with rising risks that inflation stays higher for longer and further tightening may be needed.
But thanks to the combination of inflation and shrinkflation, at least my belt won’t need to be tightened due to a glut of Easter Eggs next weekend. With some eggs this year being 44% more expensive per 100g than last year you’ll find me in the hot cross bun aisle instead. [Ed – you mean the bakery section!]
Food for Thought
Sometimes all you need is someone calm and soothing who really knows their stuff just to bring back some sense to what is going on in the world. Someone like Lothar Mentel at Tatton Investment Management perhaps, who has been sitting down with Roddi Vaughan-Thomas to discuss goings on in their latest video, link below:
Tatton Market Updates: Oil price meets economic momentum
In the Tatton Weekly, Lothar and team cover the following:
- Markets hold their breath – One man’s whim has the world economy on edge, as all markets wait to see whether Trump’s desire to deescalate the war he started makes progress.
- Europe’s surprising gas supply – The spike in natural gas prices has reduced growth prospects and increased the risk of inflation across Europe, but there is some optimism.
- Gold’s not-so-safe haven – This month`s steep fall in gold prices is teaching the gold bugs the difference between a safe haven asset, and a safe haven trade.
And if this is all enough to turn you to Red Red Wine attached is the Charles Stanley ad-hoc update (although it’s almost becoming a weekly update so much is happening!!) from Louis Coke.
Maybe Tomorrow
It is completely understandable to have a bit of a wobble when markets react they way they have to the Middle East conflict. It’s only natural – most of the readers of this bulletin are only human after all! [Ed – I’m not so sure the author is!] But it’s important to take a step back sometimes rather than react impulsively.
I’ve included in the bulletin many times the way markets bounce and if you miss the best days of recovery then it has a massive impact on returns, but there are always new readers, and the 7IM offering this week goes into a little more detail about why, and ties it back to this week’s goings on, which saw some truly unprecedented movements.
On Monday morning, after a weekend of headlines and a terrible night in Asian markets, the FTSE 100 was down nearly 3% …
Then Donald Trump opened his mouth. And so, before we even reached lunchtime, the market had turned positive for the day, and spent the rest of the afternoon acting as if nothing had happened:
Source: FactSet/7IM. Past performance is not a guide to the future.
Two weeks ago, something similar happened in South Korea. On 4th March 2026, the South Korean stock market fell 12%, the worst day in the last twenty years. On 5th March 2026, the same market rose 10%, the second-best day in the last twenty years.
These sharp swings are a great real-time reminder of the lessons behind one of our most asked-for charts.
Source: FactSet/7IM. Past performance is not a guide to the future.
You’ve probably seen it before, but the story is simple:
Markets mostly tick along, with a few big positive days and a few big negative days. Missing those few key days in the market can absolutely ruin your long-term returns.
- The FTSE 100 has had an annualised return of 6.7% over the past 20 years. £10k would have turned into £39k.
- Miss the best FIVE days and that turns into a 4.7% annualised return. 2% less PER year – which means £10k would have become £26k.
- Miss the best 30 days (one month out of twenty years!) and you lose money! £10k becomes £9k!
The big thing that the chart doesn’t show is that most of the time, the big positive days come hot on the heels of the bad days. Just when you’re feeling most scared is when things are likely to turn around.
- 30 of the BEST 40 days come within two weeks of one of the worst 40 days!
- 10 of the 40 BEST days come the DAY AFTER one of the worst 40 days!
The people who’ve sold aren’t going to be the ones buying back the next day (their brains won’t let them). They’re GIVING their long-term returns to someone else.
Sell in haste, repent at leisure … much better not to sell in the first place.
Where Did I Go Wrong
Yes, but what happens if you were lucky enough to miss the worst 40 days (?) If you were that good that you could time the market perfectly to miss the worst 40 days – very well played sir, you would have made an awful lot of money!
It’s why market timing is so tempting, but so many of the best days come after the worst!
Timing sounds easy, but it’s not… check out October 2008 or March 2020 – FTSE 100
Now tell me, hand on heart, you could, would, or did know that you would have looked at these falls and decided on the perfect time to reinvest (and then come out and then go back and out and back….)
One In Ten
Most Brits remain oblivious to major pension changes one year before they come into effect, new research suggests. Nine in 10 (89%) UK adults have “little or no awareness” of the upcoming inheritance tax (IHT) pension changes, according to experts at Standard Life. The firm added that just one in seven members of Generation X – people born between 1965 and 1980 – understand how IHT works, despite “being the generation most likely to currently be dealing with inheritance issues”. Neil Jones, tax and estate planning specialist at Standard Life, said: “With the clock ticking on the final year before pensions fall within the scope of inheritance tax (IHT), it’s concerning, though not surprising, that awareness of the change remains so low. He added: “But by 2030, around one in ten estates are expected to exceed the threshold, so IHT will be something far more people will need to understand and plan for.”
Until My Dying Day
Vitality Life is reporting more than a 50% increase in the establishment of Whole of Life insurance policies. This is largely a result of the Inheritance Tax (IHT) changes coming into effect in 2027, under which unused pensions will fall into estates on death and therefore become potentially subject to IHT.
Whole of Life policies do an excellent job of covering IHT liabilities, but if you change your perspective slightly, they can also be considered a very good investment indeed, as some rather meaty examples from Vitality show (but it’s worthwhile pro-rating the figures for your personal circumstances).
Example
A married couple, Male aged 63, Female aged 60. IHT liability of £1,000,000. Joint life second death Whole of Life policy covering £1m premiums of £1,082.02 pm.
That clearly sounds a whole lot of money to be paying out each month, but the sum assured of £1m is guaranteed to be paid out as long as the premiums continue to be paid.
The average life expectancy for this couple is Male 83, Female 85.
So, on average the total paid out in premiums would be £324,600 for a £1m pay out!
In fact, the last survivor would have to survive a total of 77 years before the premium payments matched the sum assured. Highly unlikely!
But what if you invested the premium money instead over that average life expectancy? Assuming a 6% investment growth after charges, then over the 25-year period these premiums could have built up a fund of £753,569, so still not the sum assured. Not only that but this invested amount would fall into the estate so would also be subject to IHT bringing the net amount down to £452,141.
And if the premiums are still too much to bear then Vitality has a range of ‘low-start’ and ‘health optimised’ policy additions that can bring the monthly premiums down to less than half this amount at outset if combined. Other providers are available.
If you are interested in finding our more, please speak to your usual JB Wealth advisor. [Ed – that was great but Please Don’t Make Me Cry by doing it again!]
Miscellaneous
Please find attached a downloadable copy of the latest JB Wealth tax tables for the forthcoming tax year.
National Savings and Investments (NS&I) is expected to pay hundreds of millions of pounds to customers who claim there have been failures in managing their money. The government-backed bank has been accused of a series of errors dating back years, with some bereaved families saying they did not receive money that was rightfully theirs, according to reports in the Daily Telegraph.
I wanted to share something new being offered at Rathbones this year: Industrial Placements for university students. These are now open for applications for the 2026/27 intake, so if you know any students, or children, who could be interested, the placements run for nine months from September 2026 in either London or Manchester and are aimed at sandwich‑year students on track for a 2:1. No finance background is needed; they are simply looking for curious, motivated people who want to gain real experience in a client‑focused environment.
Here are the links to apply:
Applications close on 23 April, although they may close earlier if Rathbones receive a lot of interest.
See, Don’t Slow Down- sometimes potentially useful things appear in the bulletin.
And finally, don’t forget we lose an hour on Sunday morning as the clocks go forward, so Breakfast In Bed is unlikely. I hope to catch up with you next time.