Charts of the Week
Top Ten Countries in the MSCI EAFE Index (as of 9/30/18)
Chart of the Week for October 19, 2018 - October 25, 2018
The bar chart above shows the net performance in U.S. dollars for the 1-year periods ended September 30, 2018 ("current period" - dark blue bars above) and September 30, 2017("prior period") - light blue bars above) for the MSCI EM Index, the MSCI EAFE Index, and the top 10 non-U.S. developed countries. The Morgan Stanley Capital International ("MSCI") Europe, Australasia, and Far East Index ("EAFE") is a commonly used benchmark to measure non-U.S. developed stock market performance and the MSCI Emerging Markets ("EM") Index is a commonly used benchmark to measure emerging market stock market performance. Each index consists of about twenty countries and a country can be a member of the MSCI EAFE or EM Index, but not both. The top 10 countries were determined based on their market capitalization in the MSCI EAFE Index as of September 30, 2018. The country with the largest market capitalization, Japan, is listed first, and the country with the smallest market capitalization of the ten countries reported, Sweden, is listed last.
Six of 10 of the non-U.S. stock market returns shown were positive in the current period after all 10 were positive in the prior period. Among the issues factoring into lower returns in the current period from the prior period were a stronger U.S. dollar, global trade tensions, and rising U.S. interest rates. Japan (10.20%) was the leading performer in the current period, as economic conditions there were generally improving and trade concerns did not have as much impact as other countries. EM (-0.81%) returns were impacted by China's position with the U.S. in the global trade discussions, as well as political concerns in Argentina and Brazil.
No one can be certain which direction individual countries or entire markets will move in the future, and past trends are no guarantee of future results. It is important to understand the principles of domestic and international markets and diversification before investing.
Posted by: sarah_oz@yahoo.com
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