This archive report was first published on 2 January 2020.
On the last trading day of 2019, global equity markets closed in record highs, with many indices posting double-digit gains. The dollar, however, slid to a six-month low, as investors shifted to higher-risk assets.
US President Donald Trump announced that the Phase 1 trade pact with China would be signed on January 15 at the White House, but details of the agreement remained unclear.
Despite the news, stocks failed to rise for a second day in a row, with hopes of an imminent deal being a key factor in lifting global equities to their best year since 2009, up almost 24 per cent.
MSCI’s all-country world index of equity performance in 49 nations fell 0.18 points or 0.03 per cent, to 564.2, just under four percentage points from an all-time high set on Friday.
David Kelly, chief global strategist at JPMorgan Asset Management, noted that the breakthrough in US-China trade talks and a British election earlier in December had boosted investor sentiment, but the outlook for equities next year was not as buoyant.
“This is a year in which everybody will celebrate,” Kelly said. However, he added that it would be hard to achieve similar gains, with US equities likely to advance by mid-single digits annually for several years.
Global markets, especially emerging markets, were poised to do better, Kelly said. “The US stock market rally could continue but at some stage there’s going to be a significant correction, and the more it goes up the more it’s going to correct,” he added.
