Global market review & outlook 2024

In the face of considerable headwinds, 2023 turned out to be a much better year for investors than expected, with nearly all asset classes producing positive returns, mostly well above inflation and better than cash, which itself delivered the best return since before the Global Financial Crisis. The MSCI World index of developed equity markets returned 23.8% in USD, Global Emerging Markets +9.8%, and Global Government Bonds +4.0%, while credit markets significantly outperformed risk-free government bonds, with US investment grade corporate bonds +8.5%, US high yield bonds +13.4%, and Emerging Market bonds +10.3%. Gold moved to an all-time high in USD terms at the end of the year, returning 13.1%, while commodities were the only notably weak area, with oil down by 10% and some key metals and agricultural commodities also down significantly

However, the gains were heavily concentrated in the final two months of the year, with nearly all equity and bond markets ending at or very close to their high for the year, and equity returns were concentrated in a narrow group of stocks. By mid to late October, most bond markets had been in negative territory for the year-to-date, global emerging equity markets were down, and, aside from the US and Japan, developed equity markets had made little or no progress.