Investment market update: May 2020

| Category: News

Whilst investment markets have settled a little from the severe bouts of volatility seen a few months ago, the impact of Covid-19 continues to weigh on economic and business prospects. The next few months, as restrictions are lifted and government support begins to withdraw will be crucial and give an indication of how economies will fare in the short and medium-term.


The full impact of coronavirus on the economy remains unknown. However, the lockdown and ongoing restrictions will undoubtedly have an impact. The Bank of England predicts the UK economy will shrink by 14% this year. However, it added banks are strong enough to handle this and will be able to continue lending.

During May, the government announced it was easing lockdown restrictions, allowing some businesses, including retailers, to prepare to open in June. The furlough scheme, which figures from the Office for National Statistics indicated two-thirds of firms have taken advantage of, has also been extended until October.

Unsurprisingly, economic activity has slowed considerably over the last couple of months:

  • Official figures show UK GDP shrank by 2% between January and March, just as the pandemic was beginning to take hold
  • UK private sector output fell to record lows, with data going back to 1998. The composite PMI index fell to 13.8 in April, with a reading below 50 indicating contraction
  • CBI’s measure of factory output suggests volumes are down 54% in the last quarter, with 84% of respondents stating they have seen a negative impact on their domestic output.

In a sign that consumer confidence is falling and an economic downturn is weighing on decisions, the Bank of England reported that credit growth and mortgage approvals are at their lowest point since 2013. Credit card lending fell for the first time on record, with records going back to 1987.


In a similar picture to the UK, Christine Lagarde, President of the European Central Bank, expects the eurozone economy to shrink by 8-12% in 2020. GDP across the currency area fell 3.8% in the first quarter of 2020.

The eurozone PMI did improve in May, rising to 30.5 compared to the record low of 13.6 in April. As the figure is still below 50, it indicates a contraction but could suggest that businesses are getting back on their feet as lockdown restrictions started to lift across Europe.

The EU has also unveiled its recovery fund which is accessible to all EU member states, which could go some way to offer confidence to businesses operating during these uncertain times as well as investors. The fund totals €750 billion and includes a €560 billion recover and resilience facility and a new health programme to prepare for future health crises.


Mimicking what we’ve seen in Europe, US GDP fell by 5% in the first quarter and Jerome Powell, Chair of the Federal Reserve, warned the US faced a ‘prolonged recession’.

Data released in May shows that US factory orders have suffered a 10.3% slump, with PMI data for the manufacturing sector falling to 41.5 in March. Even more worrying is the PMI April figure for the US construction sector falling to just 8.2. The lower level of activity has affected unemployment rates. The private sector suffered record job losses, with 20.5 million Americans losing their job in April.

Causing concern among investors is also the risk of a trade war igniting between the US and China again. In January, a preliminary trade deal was signed suggesting an agreement could be reached between the two nations. However, President Donald Trump has since called for tariffs as the ‘ultimate punishment’ for the handling of the coronavirus pandemic, dashing investors’ hopes.


Data from Hong Kong has highlighted the impact of coronavirus in the region. The economy shrank by 5.3% in 2020, however, last year’s pro-democracy protests and the US-China trade war will also of had an impact.

As always, it’s important to consider your long-term financial plans and goals when investing. Whilst the market may be experiencing some volatility and economic downturn, focusing on the bigger picture is crucial.

If you have any questions at all about your investments, please get in touch.


Working with Blue Ocean has enabled myself and my wife to invest our pension savings with the confidence that they are being managed by a professional team of qualified financial advisers. They have been very supportive and responsive when we've requested a detailed analysis of our investment performance and the outcome has been positive in terms of the expected returns. I have recommended family and friends to Blue Ocean and they have been equally very satisfied with the service.

Glen Ridout


A client since 2011

We would have no problem whatsoever in recommending the services of Blue Ocean for sound financial appreciation and advice, all handled in a friendly, convivial and concerned manner. Blue Ocean are always looking at how they can go that extra mile for their clients. This is a rare positive commodity in any business environment in today's world. The financial advice is always considered and simply explained in terms of what if and if you invested here etc. There is no pressure put on me to invest in high-risk return possibilities and at all stages the advice given is tailored to the perceived situation of their clients.

Barry William Ednie

Tonbridge, Kent

A client since 2013

Over the past 18 years, I have received very reassuring advice on my investments and always been treated in a friendly but professional manner.

Jacqueline Prosser


A client since 2001

I have known John for over 20 years and have always been satisfied with his integrity, knowledge and reliability. I recommend him to business and family contacts without reserve.

Paul Richardson


A client since 2002

Bespoke service... friendly, helpful staff.

Jane Stevens

Dartford, Kent

A client since 2017

Blue Ocean resolved a difficult situation in a very satisfactory way. The whole staff are extremely friendly and helpful and it was very cost-effective.

Richard Mersh


A client since 2017

Since we have used John and the team over the years our investments have gone from strength to strength. We’re very happy with the work they have done for us. I am now in a position to retire with no money worries.

Keith Yeates


A client since 2008

Honest, well versed, ‘personal touch’ business out to make sure everyone has satisfaction.

John Townsend

Hearn Bay, Kent

A client since 2017

I have received honest advice in a relaxed, friendly environment with my personal circumstances paramount.

Janice Hill


A client since 2009

I love Blue Ocean Hartley! So very helpful and fantastic staff.

Christine Bryant

Dartford, Kent

A client since 2009

Blue Ocean has always given me the help and advice that I feel protects my family’s investments. Not only have we used Blue Ocean for more than 20 years, but the team have always made us feel welcome. Always at the end of the phone for any advice we may need. Many thanks!

Russell Paul David

Rochester, Kent

A client since 2001

I have been advised by Blue Ocean for the past 21 years, and have always found their service sound, helpful and supportive.

Louise Bober


A client since 1999

Having the benefits of sound financial advice from Blue Ocean for over 20 years, I would recommend them without hesitation.

Andrew Martin

Medway, Kent

A client since 1999

We have used John Doyle and Blue Ocean for over 20 years as our financial adviser for everything from mortgages, pensions, income protection, trusts and investments. His advice has always been realistic, reliable and no-nonsense. He has always understood our requirements and has advised accordingly.

Michaela Franklin


A client since 1999

I find them very easy to deal with. Extremely knowledgeable and with no pressure.

George Howell


A client since 2016

I moved my investments to Blue Ocean in 2014. The advice I have received has been more professional and my investments have performed better. The staff are polite and always quick to respond to queries.

Lee Menzies

East Sussex

A client since 2014

Having been a client of Blue Ocean for the past 3-4 years, I can honestly say there is nobody I trust more with regards to my financial future than John and the team. Too good to be true? Not with Blue Ocean!

Liam Ryan


A client since 2016

Very good, friendly advice from a good team.

Stephen Williams


A client since 2010

Knowledgeable, approachable and always happy to discuss my issues.

Michael Southall


A client since 2018

Professional and reactive to any questions regarding your investment.

Michael Gould


A client since 2011