Market Pulse - January 2024
- Monthly Market Pulse
- 07.02.24
Key themes
- Global stock markets continued to rally in January amid robust US economic data and expectations of interest rate cuts.
- Bond markets fell, however, giving back some of their strong gains from December as expectations of rate cuts were pushed out somewhat.
- Global activity data in January was indicative of continued economic health: US numbers were robust, while Eurozone data was mixed, with some improvements in the labour market and manufacturing.
Markets snapshot
- Global equities continued to rally in January amid expectations of rate cuts in Q2 2024. The MSCI All Country World index rose by 1.3% (2.3% in euros) over the month.
- The MSCI USA rallied by 1.6% (3.3% in euros), as the theme of AI continued to support US technology stocks.
- European ex-UK equities were up by 2.1% (2.0% in euros).
- Emerging market (EM) equities underperformed developed markets in January, falling by 3.5% (-3.0% in euros).
- Global bond markets fell in January, giving back some of their strong gains from December, as expectations of rate cuts were pushed further out. The ICE BofA 5+ Year Euro Government bond index was down by 0.9% over the month.
- European investment grade (IG) corporate bonds eked out a 0.1% gain, as the income yield offset the modest capital loss. Similarly, global high yield bonds returned 0.2%.