2020 GLOBAL EQUITY MARKET RETURNS BY QUINTILE
Source: FactSet and MSCI, data from 12/31/2019 to 12/31/2020 based on MSCI All Country World Index. Past performance does not guarantee future results.
Contrary to popular perception, markets were driven by fundamentals in 2020, not euphoria. Companies exhibiting strong growth and quality outperformed companies with opposite characteristics by a wide margin.
FUNDAMENTALS NOT EUPHORIA DRIVE MARKETS
TECH DOMINATES FOR GOOD
With accelerating adoption of cloud-computing; digital business-to-business applications; and online retail, health care, education/learning, and business services, technology-related company earnings are driving overall earnings growth. Whereas in 2009, investors could gain similar returns with or without investing in tech, today, excluding tech significantly reduces total earnings growth due to tech’s outsized contribution. A strong earnings rebound across most sectors is expected in 2021, with tech continuing to drive strong earnings growth given its increased influence across other sectors.
Source: FactSet, MSCI, Jennison; data from 1/1/2009 to 12/31/2020. Past performance does not guarantee future results.
Earnings Growth Increasingly Driven by Tech