Global Equity Markets Show January Advance

February 6, 2006 ( - Whether calculated in US dollars or local currency, equity markets in every developed world country except New Zealand gained ground in January, according to Standard & Poor's.

Europe came out of the blocks strong in January, helping to push the S&P/Citigroup Developed World Index to a 5% advance for the first month of the year. The European Broad Market Index (BMI) started off 2006 with a 6.98% hike followed by Asia-Pacific and North America gains of 5.12% and 3.9% respectively.  On an individual country basis, European countries posted the best returns in January.

“Ignoring energy prices, investors seemed to have been focused on a number of positive factors in January,” said Nicholas Aninos, analyst at Standard & Poor’s Index Services in an S&P news release.  “In Europe, production and unemployment numbers reported during January were strong, as were consumer and business confidence figures.  The situation in the US was similar, but only to a lesser degree, with the belief that the Federal Reserve is nearing the end of its run on interest rate increases.”

Emerging markets shot up 11.09% in the first month of the year, as January represented the best monthly performance for the S&P/Citigroup Emerging Markets Index since January 2001.  Brazil, Russia, China, and South Africa were the main contributors to the strong showing, showcasing returns of 24.67%, 19.96%, 14.91% and 14.89% respectively.  Only Taiwan and Jordan lost ground during January, with Taiwan actually up when measured in US dollars. 

Sectors, as defined by the Global Industry Classification Standard (GICS), saw Energy finish up 13.28% in January.  The Energy sector performance was widespread as each sub-industry posted strong returns, with a significant number of companies showing gains of more than 20%.  The Materials sector, which rose 9.9% during the month, was the next best performing GICS sector.

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