Agenda item

Consideration was given to graphs showing the recent movements in the Stock and Share indices (for copy see file of Minutes).

Philip Williams advised that since January 2016 bond yields had fallen to their lowest ever levels and equity markets had also experienced a downturn. This would have an impact on the actuarial valuation of the Pension Fund due on 31 March 2016. Daniel Banks was of the view that the low bond yields globally would be a long-term trend and prices may fall even further.

Robbie Bowker provided an update to the end of February 2016. He advised that the position in China where markets had fallen by 10% on 23 August 2015, the fall in oil prices, interest rate levels, geopolitical issues and more recently Brexit had contributed to the fall in returns on the major asset classes and bond markets in particular. The UK Markets were down 2.3% and Japanese markets by 6%. Emerging markets were performing better and could be good value at present. In such market conditions investors tended to adopt an offensive stance, seeing UK Government gilts as safe and this was pushing the prices upwards. 

Given the current global market volatility Councillor Carr asked if the Fund’s investments in the US had been affected.

Philip Willliams responded that CBRE continued to perform well ahead of target. Global property as a major asset class was still benefitting from growth.

Resolved:

That the information given be noted.