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August market performance: Equities rally amid shifting economic winds

Market Rewind
Soren Otto 400x400
Søren Otto Simonsen

Senior Investment Editor

In August, global equity markets surged, with the MSCI World Index climbing 2.5%. Investors regained confidence, pushing equities higher despite ongoing concerns about inflation and central bank policies.
Web 1200x500 Global equity performance 20240902

In the United States, the S&P 500 rose 2.3% in August, rebounding after a quieter July. The U.S. market showed resilience as investors adjusted towards expected rate cuts and the US election as a constant curveball. European equities gained 1.4%. Stabilising energy prices and confidence in the European Central Bank’s inflation strategy helped boost market sentiment. Asian markets continued their steady rise with a 1.6% increase, driven by strong corporate earnings and supportive monetary policies. Japan, in particular, attracted investors seeking growth opportunities. Emerging markets posted a 1.4% gain, outperforming July. Despite challenges in China, other emerging economies showed resilience, drawing investor interest.

Web 1200x500 Regional performance 20240902
August saw mixed results across sectors. The real estate sector soared 5.7%, as investors flocked to tangible assets for stability in uncertain times. Healthcare continued its strong performance with a 5.4% rise, driven by robust demand and ongoing innovation. The information technology sector grew by 1.4%. While not as strong as earlier in the year, the sector remains critical, attracting investment despite rising costs and supply chain issues. The energy sector faced challenges, dropping 1.4%. Fluctuating oil prices and geopolitical uncertainties contributed to this decline, highlighting the sector’s volatility.
Web 1200x1200 Sector performance 20240902
The bond market remained a stable haven in August, offering consistent returns amid equity market fluctuations. Global bonds continued to perform well, with sovereign and corporate bonds delivering reliable yields.
Web 1200x500 Global bond performance 20240902

Sources: Bloomberg and Saxo

Global equities are measured using the MSCI World Index. Equity regions are measured using the S&P 500 (US) and the MSCI indices Europe, AC Asia Pacific, and EM respectively. Equity sectors are measured using the MSCI World/Sector indices, e.g., MSCI World/Energy. Bonds are measured using the USD-hedged Bloomberg Aggregate Total Return indices for total, sovereign, and corporate respectively.

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