Salient to Investors:
The MSCI All-Country World Index of equities increased 16.9 percent in 2012 including dividends, versus 0.1 percent for the S&P GSCI Total Return Index of 24 commodities, 0.5 percent for the US Dollar Index, and 5.73 percent for the Bank of America Merrill Lynch Global Broad Market Index.
James Dunigan at PNC Wealth Management said massive global stimulus is a big piece of the rally, plus earnings. Andrew Slimmon at Morgan Stanley Smith Barney said we’ve been reminded to not fight the Fed, and this applied to Europe.
The median economist expects the global economy grew 2.2 percent in 2012 and increase 2.4 percent in 2013.
The MSCI global index trades at 15.4 times reported earnings versus its historical average of 20.7 since 1995. Analysts estimate the MSCI All-Country Index to show earnings growth of 11 percent in 2012 , and 12 percent in 2013.
The S&P 500 rose 13 percent in 2012 to 1.8 percent above the average estimate of 14 Wall Street strategists, who predict an average rise of 7.3 percent in 2013. The MSCI Emerging Markets Index rose 18 percent in 2012 including dividends.
The median economist expects yields on 10-yr US government debt to rise to 1.88 percent by the end of Q2 2013.
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