Over the last quarter, global equity markets and indeed our funds continued to post solid gains, when measured in US dollars. Despite continued strengthening of the Euro, most markets were up even in Euro terms. Global markets (MSCI World) were up 1.15 percent, European equities (MSCI Europe) gained 2.70 percent and Emerging Markets (MSCI EM) were even stronger with a return of 4.19 percent.
Similarly, if we look at the year-to-date performance, equity investors have plenty of reasons to be happy this year. Returns have been positive, volatility is low and corporate profits have been very strong globally, which suggests that the improvement in the global economy is real. Moderate global growth has not yet fueled inflationary pressures, meaning that central banks in Europe, Japan and the US have been able to maintain relatively relaxed monetary policies. This so-called Goldilocks economy (not too hot, not too cold) has provided a solid backdrop for equities, which could remain in place for the rest of the year.
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