A Macro Perspective of Various Assets Classes in February 2021

on Feb 12, 2021
Updated: Dec 19, 2022

As we get close to the second half of the trading month, it is appropriate to have a look at major asset classes and see how they evolved in 2021 so far. Also, did anything change from last year-end 2021 outlook, and, if yes, what? 

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Oil Already Exceeded Year End’s Target

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Oil is the biggest winner of the year so far. It has its best start in the last three decades and has already surpassed the expectations for the year. At the end of 2020, the majority of investment houses saw the price of oil hovering around $55 toward the end of 2021. Considering that it already threatens to break above $60, is it perhaps time for the price of oil to correct?

As pandemic concerns start to curb somewhat due to increasing vaccination rates, the perspectives for the global oil market remains constructive. Demand should continue the more the global economy opens up again.

Equities Rally Continues

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Equities hover around all-time highs as the buying pressure continues. The new administration in Washington promised new stimulus, and the huge amounts of money thrown into the economy found their way to the stock market.

Exchanges have witnessed record trading levels in 2021, as retail investors herd together to bid various names, regardless of valuations. Emerging markets outperform at the start of the trading year, mostly fueled by a weak dollar. Asia, in particular, did well, and the consumers’ sector outperformed other sectors globally.


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The FX market consolidates more than traders would like it to. The focus this year so far moved to the cryptocurrency market, where the main cryptocurrencies and some altcoins delivered impressive performances. However, the volatility in the cryptocurrency market remains elevated, Bitcoin losing over thirty percent in a matter of days in January.

The reflation theme remains, and the dollar is sold across the board. Only the EURUSD pair remains lower when compared to the start of the trading year, mostly due to the gap between the Euro area and the United States economic growth.

All in all, a mixed picture, but nothing unusual when compared to last year’s closing levels. With the exception of oil, financial markets remain exceptionally stable, giving the events seen so far in the first six weeks of the year (e.g., assault on the U.S. Capitol, new U.S. administration, perspective of higher inflation due to rising oil prices).


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