Volatility returned to global markets in 2018. After making fresh record highs in January, most stock indices have undergone the first notable correction in two years. Yet global equities have confounded the sceptics for almost a decade and until recently complacency was abundant. This has been against an unequivocally positive global macroeconomic backdrop. Leading economies are enjoying a rare period of sustained synchronised growth as central banks globally keep interest rates low. Central banks such as the European Central Bank and the Bank of Japan continue to run quantitative-easing programmes, while the US recently cut its corporate tax rates. In combination, this caused the strongest rate of earnings growth since 2010 to be registered in 2017. Marking the ninth year of the global bull market, the MSCI World Index was up more than 23% and delivered positive returns in all four quarters for the first time since 1996. Similarly, the S&P 500 Index delivered 12 positive months fo...

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