Global equity markets get in the mix amid volatility.

Global equity markets, as measured by the MSCI ACWI Index, lost ground in February, though performance was mixed among regions. Despite a decline towards the end of the month in response to President Trump’s threat to impose tariffs on imported goods from the European Union (a political and economic union of 27 European countries), the European market generally benefited from investors’ optimism that the region would avoid a trade war with the U.S. Uncertainty regarding the proposed tariffs and a downturn in the technology sector hampered the U.S. equity market.

Emerging markets garnered modestly positive returns and outperformed their developed-market counterparts in February. The Nordic countries were the strongest performers within the developed markets for the month, bolstered mainly by strength in Sweden and Denmark. The rally in Europe was attributable primarily to upturns in Ireland and Spain. Conversely, North America was hampered by a decline in the U.S. market. Chinese stocks listed on the Hong Kong Stock Exchange led the emerging markets in February. Additionally, Eastern Europe benefited from strong performance in Poland. In contrast, the Association of Southeast Asian Nations (ASEAN) region recorded a negative return due to weakness in Thailand and Indonesia.¹

On February 3, a day before 25% across-the-board tariffs on Mexico and Canada (with an exception for Canadian energy, which faces a 10% duty) were scheduled to be implemented, the Trump administration reached agreements with Canada and Mexico to delay the levies for 30 days. This was only after Mexico agreed to send 10,000 troops to the border to combat the flow of fentanyl into the U.S., and Canada pledged to appoint a fentanyl czar, list cartels as terrorists, and launch a joint strike force with the U.S. to combat organized crime, fentanyl trafficking, and money laundering. At the end of February, Trump announced that he was considering 25% tariffs on imports from the European Union. He also commented that the levies against Mexico and Canada were still scheduled to take effect in early March. The ongoing tariff dispute remains highly volatile and in constant flux.

¹ All equity market performance statements are based on the MSCI ACWI Index.

Disclosures 

This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding SEI’s portfolios or any stock in particular, nor should it be construed as a recommendation to purchase or sell a security, including futures contracts. T

here are risks involved with investing, including loss of principal. International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles or from economic or political instability in other nations. Emerging markets involve heightened risks related to the same factors as well as increased volatility and lower trading volume. Narrowly focused investments and smaller companies typically exhibit higher volatility. Bonds and bond funds will decrease in value as interest rates rise. High-yield bonds involve greater risks of default or downgrade and are more volatile than investment-grade securities, due to the speculative nature of their investments. 

Diversification may not protect against market risk. Past performance does not guarantee future results. Index returns are for illustrative purposes only and do not represent actual portfolio performance. Index returns do not reflect any management fees, transaction costs or expenses. One cannot invest directly in an index. 

Information provided by SEI Investments Management Corporation, a wholly owned subsidiary of SEI Investments Company (SEI).