Global Equity Markets Show Resilience Despite Rising Uncertainty

The first quarter of 2023 began with a strong rally in global equity markets driven by moderating inflation, declining bond yields in the U.S. and Europe, resilient economic data, and China’s reopening post-COVID. Market strength eased as concerns over rising interest rates, early cracks in employment, and slowing durable goods orders rekindled recession fears. However, markets resumed their climb as central banks injected liquidity into the global banking system following the collapse of Silicon Valley Bank and Signature Bank in the U.S. and Credit Suisse experienced a forced sale to UBS due to financial stress. These events, together with signs of weakening inflation and fears of further instability in the global financial system, spurred hopes for less hawkish policies by central banks globally moving forward.

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Index definitions: MSCI USA Index measures the performance of the large and mid cap segments of the U.S. market. MSCI AC Asia Pacific measures large and mid-cap equity performance of developed and emerging markets countries in the Asia Pacific region. MSCI All Country World (ACWI) measures equity performance of developed and emerging markets. MSCI EAFE® measures developed foreign market equity performance, excluding the U.S. and Canada. MSCI AC World ex U.S. measures equity performance of developed and emerging markets, excluding the U.S. MSCI Emerging Markets measures equity market performance in global emerging markets. MSCI Europe measures equity market performance of Europe’s developed markets. MSCI Emerging Markets Latin America measures equity performance of Latin America’s emerging market countries. Indexes are free float-adjusted market cap-weighted and calculated on a total return basis with dividends reinvested.