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The year of 2022 proved to be one of the most challenging and volatile for emerging market (EM) equities.

European equity markets made a very strong start to the year, supported by easing inflation figures, both in the US and Europe, the surprisingly quick end to the zero-Covid policy in China and the relatively mild winter that has defused the energy crisis in Europe and thus the risk of a deep winter recession.

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Despite a fairly significant rally beginning in October, European equity markets, battered by major outflows since the start of the crisis in Ukraine, recorded a correction over the year 2022 (-9.5%). Although European equities finished the year on a relative outperformance compared with the United States (-13.4%) and emerging markets (-15.1%)1, the year was still a source of concern for investors, who are now asking questions about what may arise in 2023.

European equity markets registered a significant rebound from the previous month. This was mainly driven by China’s decision to ease its zero COVID-19 policy.

After a slightly hesitant start, European stock markets continued their recovery from the October lows and ended November well into the green.

European equities have rebounded over the past four weeks. The rebound was mainly driven by value stocks that have outperformed growth stocks since the last Equity Committee.

European equities closed September lower. In Europe, the energy crisis continued to dominate the headlines, as Russia completely halted gas flows through the key Nord Stream 1 pipeline at the beginning of the month.