Global Markets Produce Mostly Negative Returns
06 July (PLANSPONSOREurope.com) - Plan sponsors with defined benefit schemes could well have found equity asset allocations in Q2 have yielded negative returns no matter where in the world investments have been made.
The latest data from MSCI, a global provider of investment decision support tools, finds global equities have yielded widespread negative returns across global markets.
The MSCI Developed Markets Indices suffered a broad range of negative results in Q2 2012. The MSCI World Index lost a relatively mild -5.82% for the quarter, masking some of the very steep losses that were incurred among several developed markets countries and regions. Double digit losses prevailed in the EMU; the MSCI Greece Index was the worst performer, returning 30.83% in Q2, while the MSCI Portugal and MSCI Finland Indices were the second and third worst Q2 performers, with returns of 21.39 and 23.82%, respectively. The MSCI Italy, MSCI Spain, MSCI Austria and MSCI Germany Indices fared only slightly better, delivering Q2 losses in the 14.41% to 16.71% range. Among developed markets single country indices, the MSCI Belgium, MSCI Denmark and MSCI USA Indices were the top performers with returns of 1.75%, 3.32% and -3.55%, respectively. The MSCI North America, MSCI World ex Europe and MSCI World ex EMU Indices were the top performing developed markets regions, with Q2 returns of 3.96%, -4.59% and -4.88%, respectively.
Meanwhile the MSCI Emerging Markets Indices posted a narrower range of negative returns relative to the developed markets. The MSCI Emerging Markets Index returned -10% for Q2, resulting in a small positive return of 2.29% for the first half of 2012. The MSCI Brazil, MSCI Morocco and MSCI Russia Indices posted Q2 returns of 19.96%, 17.44% and -16.90%, respectively, and stood as the three worst single country index performers. The MSCI Philippines Index was the lone emerging markets country index to produce positive results for the quarter, returning 3.31%. The MSCI Turkey and MSCI Mexico Indices were the second and third best performers with Q2 2012 returns of -1.33% and -1.85%, respectively.
Elsewhere the MSCI Frontier Markets Indices produced the most widely dispersed results in Q2 2012. The MSCI Frontier Markets Index returned -8.31% over the quarter, while the MSCI Frontier Markets Africa Index was the single regional index to produce positive results over the period, with a return of 2.78%. The top three single country index performers (all within Africa) were the MSCI Kenya, MSCI Nigeria and Bahrain Indices, which posted returns of 7.07%, 3.17% and 2.43%, respectively. The bottom performers were the MSCI Bulgaria, MSCI Ukraine and MSCI Argentina Indices with returns of -25.95%, - 35.96% and -43.77%, respectively.