01 May 2020
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Seven Insurance Brokers Market Update
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VAM Funds

Welcome to our weekly newsletter, where the Manager summarises the key market developments over the last seven days.

The Noise

In his first national address since recovering from COVID-19, Boris Johnson announced that the UK has passed the peak of infections, but he will not risk lifting restrictions too soon. The Prime Minister pledged to reveal a “road map” next week on how the country will leave the Coronavirus lockdown and get back to work. He promised a cautious approach to lifting the lockdown in order to avoid a second spike in infections.

Data released on Wednesday showed that US GDP shrank 4.8% in the first quarter of 2020, representing the largest contraction since the 2008 financial crisis. However, markets were up over the week, showing that investors had already looked through the decline in economic activity well in advance of the release of the official figures.

As company reporting picks up, it becomes increasingly apparent that many are planning ahead for the imminent easing of lockdown measures across the globe. The phased reopening of economies will kick-start these businesses as we are gradually starting to see the road ahead a little more clearly.

The Numbers

GBP Performance to 30/04/20
1 Week
Absolute Level
Equity GBP Total Return (MSCI)





Europe (MSCI Europe)








Japan (MSCI Japan)




Emerging Markets (MSCI Emerging)




Fixed Income GBP Total Return

UK Government (Barclays Sterling Gilts Index)




Investment Grade Hedged (Barclays Global Aggregate Corporate Bond Index)




High Yield Bonds Hedged (Barclays Global High Yield Index)




GBP Performance to 30/04/20
1 Week
Absolute Level
Currency Moves













Commodities GBP Return

Gold (in £)




Oil (in $)




Source: Bloomberg, data as at 30/04/2020

The Nuance

Corporate news flow has ramped up this week as firms have begun to update markets on how exactly the Coronavirus pandemic has affected them. Many of the Manager’s portfolio businesses shared encouraging news, demonstrating that a slow return to business as usual is ensuing. For example, InterContinental Hotels Group announced on Monday that 97% of its 470 hotels in China have reopened since the country began to ease lockdown restrictions. It’s encouraging to see those economies which are further along the curve starting to come alive again and the positive effects on businesses in these regions.

Markets have behaved bullishly in the last few weeks with many stocks running hard. Defensive stocks in particular have seen significant price rerating as investors crowd into safer assets. If markets are to continue to progress upwards from here, cyclical companies need to move higher, which will require some restarting of the global economy. Businesses that are suffering greater hardship from the lockdowns will only fully recover when people start going back to work, and shops, restaurants and offices are allowed to reopen.

Investors seem keen to hide in defensive companies, evidenced by stretched valuations in these safer assets. The Manager is carefully monitoring its investments, analysing each company’s prospects and value. The Manager has taken some steps to sell down those which have become too expensive, but it cautions that, despite some slightly rich valuations, these businesses are still set to deliver longer-term returns and cope with inflation. Despite the potential for a short-term pause in performance, they continue to earn their way into the portfolio.

Sanlam Virtual Event Programme

Earlier in April, the Manager organised a series of events designed to offer some respite from the lockdown measures. Whilst it remains diligently focussed on protecting client wealth amidst the extraordinary market backdrop, it also wishes to do everything it can to help clients andcontacts through this period. In light of the extended lockdown and the extremely positive feedback it received on the first round, the Manager has extended this virtual event series, continuing some of the previous events and offering a few new ones.

Please click on the flyer to the right which will take you to the Eventbrite page displaying the schedule of virtual events the Manager has created with experts in a variety of fields, designed to offer something for everyone and accessible with just a click of the button.

Please sign up to any and all that you feel might be relevant to you and/or pass onto to your own clients as appropriate. Further information on each event is available by clicking on them individually in the link provided.

Source: Sanlam Private Wealth

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For more information on VAM Funds, please contact us at sales@vam-funds.com or on +230 465 6860

Issued by Seven Insurance Brokers LLC

Sanlam Private Wealth is a trading name of Sanlam Private Investments (UK) Ltd.

Past performance is not a reliable indicator of future returns, investing involves risk and the value of investments, and the income from them, may fall as well as rise and are not guaranteed. Investors may not get back the original amount invested.

The information and opinion contained in this market view should not be treated as a forecast, research or advice to buy or sell any particular investment or to adopt any investment strategy. Any views expressed are based on information received from a variety of sources which we believe to be reliable, but are not guaranteed as to accuracy or completeness by Sanlam. Any expressions of opinion are subject to change without notice.

Disclaimer: VAM Cautious, Balanced and Growth Funds are compartments of VAM Managed Funds (Lux).
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