In May, global equity markets provided positive returns, in sterling terms. In the UK, equities outperformed, thanks largely to the boost in sentiment following the surprise general-election result, which brought a Conservative majority to power. This smoother than expected political transition was well received by investors. Meanwhile, European equities were down in sterling terms amid intensifying concerns that Greece would miss the June deadlines for repayment to its creditors. Equity markets in the US made gains, helped along by the stronger dollar. Despite a downwards revision to the official first quarter GDP figure, from 0.2% expansion to 0.7% contraction, investors seemed to side with the US Federal Reserve, which attributed the weaker data to extraordinary factors like the harsh winter weather and lower oil prices. Elsewhere, emerging market and Asian equities were down for the month. Chinese equities were affected by bouts of profit taking, but there was strong evidence in the form of an interest-rate cut by China’s central bank – that the authorities would maintain their accommodative policy stance.