February 2024

• Global markets advanced strongly in February as resilient economic growth, moderating inflation and continued enthusiasm surrounding artificial intelligence supported investor confidence.
• Technology and semiconductor stocks led gains globally following exceptionally strong earnings from major AI-related companies.
• Bond yields remained relatively elevated as economic data continued outperforming expectations.
• Central banks maintained cautious guidance regarding future interest rate cuts.
• Chinese markets remained under pressure despite additional policy support measures.
• Commodity prices delivered mixed performance amid stable global demand and weak Chinese construction activity.

Asia (ex. Japan)

Asian markets outside Japan delivered mixed performance during February as strong technology sector momentum offset continued concerns regarding Chinese economic weakness and property sector instability.

Taiwan and South Korea benefited significantly from artificial intelligence-driven semiconductor demand, while Chinese authorities introduced additional market support measures to stabilise investor sentiment and economic activity.

Europe

European equities advanced during February as inflation continued moderating gradually and corporate earnings generally remained resilient despite weak industrial activity.

Investors increasingly anticipated that the European Central Bank could begin easing monetary policy later in the year, while financial and luxury goods sectors performed relatively well.

United States

U.S. equities reached further record highs during February as strong earnings from major technology companies reinforced investor optimism surrounding artificial intelligence and future productivity growth.

Economic activity remained stronger than expected, leading investors to reduce expectations for near-term Federal Reserve rate cuts while still maintaining confidence in the broader economic outlook.

United Kingdom

UK equities delivered relatively modest gains during February as easing inflation supported sentiment despite continued weakness in domestic economic growth and consumer demand.

Investors increasingly focused on the potential timing of future Bank of England rate cuts as inflationary pressures gradually moderated.

Japan

Japanese equities continued surging during February, with major indices reaching historic highs as foreign investment inflows, corporate reforms and strong technology demand supported market momentum.

The weaker yen continued benefiting exporters and manufacturing companies tied to global semiconductor and industrial supply chains.

Emerging Markets

Emerging markets delivered mixed results during February as stronger U.S. economic data and elevated Treasury yields created some pressure on capital flows.

However, technology-related Asian markets significantly outperformed due to continued semiconductor and artificial intelligence demand growth.

Commodities

Commodity prices delivered mixed performance during February. Oil prices remained relatively stable as geopolitical risks balanced against adequate global supply conditions.

Industrial metals remained constrained by weak Chinese construction demand, while gold prices traded within a narrow range amid elevated interest rates and stable inflation expectations.