The fund was down 0.95%, in line with MSCI World Index which was down 0.93% in US dollar terms. The best performers in the fund were Nova, Microsoft, and Apple, while the worst performers were Masimo (which has been sold out off the fund), Carlsberg, and Sea. Growth outperformed value with MSCI World Growth up 2.43% and MSCI World Value was down 4.49%. In terms of sector performance, Energy and Materials were the worst performers, while Information Technology and Consumer Services were the best performers.

One of the key drivers of the strong performance of technology stocks has been optimism over Artificial Intelligence (AI). These companies are seen as the winners in the AI space, and investors have been pouring money into them as a result. In addition, concerns over the US banking sector have led to a rotation out of some value stocks and back into growth stocks, specifically the supertech names (MAGMA- Microsoft, Apple, Google, Meta, and Amazon), which have been reporting resilient earnings overall. This has either come through revenue improvements and/or cost-cutting measures or improving operating efficiency.

The Federal Reserve raised the overnight rate to a target range of 5-5.25% in May, marking the tenth rate hike in slightly over a year. This is the highest rate observed since August 2007. Despite this, Jerome Powell, the Fed Chair, mentioned that the committee will continue to be "data dependent". He also expressed a feeling that the tightening cycle is closer to its end than its beginning. The U.S. yield curve remains inverted, with the two-year treasuries still yielding more than the 10-year treasury. The 10-year treasury bill saw yields increase from 3.43% to 3.64% from the end of April to the end of May, while the 2-year treasury bill also saw yields increase from 4% to 4.4%. The market was concerned about the risk of default due to the debt ceiling as a result yields went up. In Europe, the Bank of England, and the European Central Bank (ECB) both hiked rates by 25bps to 4.25% and 3.25% respectively. ECB President Christine Lagarde emphasized that they are not pausing rate increases and that there is still more ground to cover, but they will remain data dependent. Germany entered a technical recession, with GDP falling by 0.5% q/q in Q4 2022 and by 0.3% q/q in Q1 2023. Meanwhile, the UK's GDP grew by 0.1% in Q1 2023.

In Asia, China's economic data was weaker than market expectations in April, but it still indicates an improving economy. The official manufacturing purchasing managers' index (PMI) dropped to 48.8, a five-month low and below the 50-point threshold that separates growth from contraction. The service sector also experienced its slowest expansion in four months in May, as the official non-manufacturing PMI fell from 56.4 to 54.5. Although retail sales increased by approximately 20% y/y in April, insufficient demand remains the primary obstacle to recovery, and deflation risks are on the rise in China.

In conclusion, the global economic landscape in May was marked by rate hikes in the US, UK, and Europe, as well as weaker-than-expected economic data in China. While the US economy appears to be nearing the end of its tightening cycle, the ECB and Bank of England are continuing to raise rates. Meanwhile, Germany is in a technical recession, and China is facing deflation risks due to insufficient demand. These developments highlight the importance of remaining data dependent and monitoring economic indicators closely.