January 2024

• Global markets began 2024 with mixed performance as investors reassessed expectations for rapid interest rate cuts following stronger-than-expected economic data.
• Technology and artificial intelligence-related sectors continued outperforming, particularly within U.S. equities.
• Bond yields rebounded modestly as central banks pushed back against aggressive market expectations for early policy easing.
• Chinese markets remained under pressure due to persistent property sector weakness and slowing domestic demand.
• Energy prices stabilised amid ongoing geopolitical tensions in the Middle East.
• Emerging markets delivered mixed performance due to divergent economic conditions and shifting monetary expectations.

Asia (ex. Japan)

Asian markets outside Japan delivered mixed results during January as continued weakness in China’s property sector and domestic demand weighed on broader regional sentiment.

Technology-focused markets such as Taiwan benefited strongly from artificial intelligence-driven semiconductor demand, while Chinese authorities introduced additional support measures aimed at stabilising financial markets and economic growth.

Europe

European equities delivered relatively stable performance during January as easing inflation supported investor sentiment despite weak manufacturing activity across several economies.

Investors increasingly focused on the timing of potential European Central Bank rate cuts later in the year while monitoring slowing economic growth conditions.

United States

U.S. equities advanced during January as strong corporate earnings and continued enthusiasm surrounding artificial intelligence supported technology and growth sectors.

Economic data remained stronger than expected, leading investors to reduce expectations for immediate Federal Reserve interest rate cuts and causing Treasury yields to rise modestly.

United Kingdom

UK equities delivered mixed performance during January as slowing inflation improved the long-term outlook, though weak domestic economic growth and elevated borrowing costs continued weighing on sentiment.

Investors increasingly anticipated that the Bank of England could begin easing policy later in 2024 if inflation continued moderating.

Japan

Japanese equities surged during January, reaching levels not seen in decades as foreign investor inflows, corporate governance reforms and weak yen conditions continued supporting the market.

Exporters particularly benefited from currency weakness and strong global technology demand, while speculation regarding future Bank of Japan policy changes remained limited.

Emerging Markets

Emerging markets delivered mixed results during January as stronger U.S. economic data and rising bond yields reduced some investor appetite for higher-risk assets.

Technology-related Asian economies remained key outperformers due to semiconductor and artificial intelligence-related demand growth.

Commodities

Commodity prices delivered mixed performance during January. Oil prices remained relatively stable despite ongoing geopolitical tensions in the Middle East and Red Sea shipping disruptions.

Industrial metals remained under pressure due to weak Chinese construction activity, while gold prices traded within a relatively stable range as investors balanced geopolitical risks against rising bond yields.