Since the start of the year, the MSCI All-World share index has doubled, marking one of the strongest run-ups in global equities. This upswing is being supercharged by a retail trading boom, which has driven the global call market back to three-decade highs. Meanwhile, central banks around the world are meeting and adopting more hawkish stances. This could have a bearing on the markets.
Global equity indices provide investors with access to all market segments, and are widely used for benchmarking. They use a common classification scheme called Global Industry Classification Standard (GIICS), developed by MSCI and S&P Global, which offers non-overlapping size segmentation and a consistent methodology for each market. Additionally, MSCI uses both liquidity and size measures to ensure that its indexes reflect the full opportunity set of the markets they cover.
The MSCI All World share index rose to a record high on Monday. Oil prices climbed above $60 per barrel, and the euro weakened slightly against the dollar. The European and American central banks are expected to further boost their bond buying next week. In addition, the U.S. Federal Reserve is expected to tweak its asset-purchase guidance later this month. The news helped the riskier assets and kept the safe-haven dollar at a two-and-a-half-year low. Furthermore, the bipartisan coronavirus aid plan that was passed by Congress on Thursday gained momentum. With conservative lawmakers speaking out in support, the odds of a deal before year’s end appear to be greater than ever.
In other news, European markets opened lower on Friday. European markets, including France and Italy, were little changed. The dollar and euro were slightly higher on Friday. Investors focused on the speech of the U.S. Federal Reserve chair at a virtual Jackson Hole conference. The MSCI All-Country World Index, which tracks shares in 47 countries, fell 0.3 percent on Friday, snapping a six-week winning streak. In Europe, stocks were less volatile on Friday, but major indices recovered, with the German and French stock markets. Only Spain’s IBEX fell half a percent.