Global Equities: Turning of the Tide?
The daily ebb and flow of markets can muddy the waters for investors. It is often hard to know whether we are on the cusp of another acceleration or about to slip into a crisis. If we look back twelve months, markets were wracked with concerns about an escalating trade conflict, intractable Brexit arguments and slowing global growth. Fast forward to the end of 2019. Not only did many of those fears fail to materialize, but the partial lifting of geopolitical clouds and a brightening economic outlook lit a fire under equities. The MSCI All Country World Index (ACWI) shook off a flat third quarter to rise 8.95% in the final three months of the year, with U.S., European, and emerging markets equities all advancing strongly. All sectors in the Index posted positive returns for the quarter, with information technology and healthcare up double digits.
Fourth quarter performance capped a year that was not without volatility—particularly in emerging markets—but was among the best years of the decade for many equity markets. The information technology sector, beaten down in the final quarter sell-off of 2018, led the rally as all sectors of the MSCI ACWI posted double-digit returns for the year, with all but energy exceeding 20%.
MSCI All Country (AC) World measures equity performance of developed and emerging markets. MSCI EAFE® measures developed foreign market equity performance, excluding the U.S. and Canada. MSCI Europe measures equity market performance of Europe’s developed markets. MSCI Japan measures performance of the Japanese market’s large and mid-cap segments. MSCI AC Asia Pacific ex Japan measures equity market performance of Asia’s developed and emerging markets (excluding Japan), Australia and New Zealand. MSCI Emerging Markets measures equity market performance in global emerging markets. MSCI AC World ex US measures equity performance of developed and emerging markets, excluding the U.S. S&P 500® measures performance of 500 of the largest U.S. companies. All indexes are free float-adjusted market cap-weighted and calculated on a total return basis with dividends reinvested.
The commentary is the opinion of the subadviser. This material has been prepared using sources of information generally believed to be reliable; however, its accuracy is not guaranteed. Opinions represented are subject to change and should not be considered investment advice or an offer of securities.
Past performance is not indicative of future results.