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Geopolitical risk premiums eliminated in March

The military conflict between Russia and Ukraine continues to affect the financial markets.

The initial phase of the conflict led to higher risk premiums until mid-March – after which the risk premiums were generally eliminated in the second half of the month. Broadly speaking, the returns pattern seen so far has matched those seen in connection with previous military conflicts.

According to MSCI ACWI, global equities gained 2.5% in March, stated in local currencies. Stated in DKK, the return was 3.3%. Equity returns in the US and Japan exceeded those in Europe last month. At the sector level, the highest price rises were seen in Energy, Insurance and Health Care, while Banks and Consumer Staples showed the strongest falls.

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