Commentary
Stocks move higher in May despite a late glitch
Our May monthly market commentary.
Stocks move higher in May despite a late glitch
Global equity markets rallied for much of May 2024, as signs of slowing inflation and weaker-than-expected economic data bolstered investors’ optimism that the Federal Reserve (Fed) and other major central banks will pivot to a rate-cutting cycle by the end of summer. However, stocks weathered a downturn during the last week of the month after Minneapolis Fed President Neel Kashkari raised the possibility of interest-rate hikes. At the Barclays-CEPR International Monetary Policy Forum in London on May 28, Kashkari commented, “I think the odds of us raising rates are quite low, but I don’t want to take anything off the table.” Kashkari is not a voting member of the Federal Open Market Committee (FOMC), the Fed’s monetary policymaking body responsible for setting the federal-funds rate.
The Nordic countries were the strongest performers among developed equity markets in May, led by Norway and Finland. North America also posted a notable gain attributable mainly to a strong rally in the U.S. The Far East recorded a positive return for the month, but was the primary developed-market laggard due to relative weakness in Japan and Hong Kong. Europe was the top performer within emerging markets for the month, attributable primarily to strength in the Czech Republic. Conversely, Latin America posted a negative return and was the most notable underperformer due to weakness in Brazil.1
1 All equity market performance statements are based on the MSCI ACWI Index.
All references to performance are in US dollar terms unless otherwise noted. See Standardised Performance for more information.
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