World equity index creeps to new high

Global stocks are trading at record highs, the dollar is weaker and gold is rallying on expectations the Federal Reserve will remain patient over the timing of any increase in borrowing costs.

After a positive session for Asian equities, in Europe the FTSE Eurofirst 300 is opening flat at its seven-year peak, while US index futures suggest the S&P 500 will hold its record of 2,115.5, though the latter not helped by poorly-received results from Hewlett-Packard.

All this leaves the FTSE All-World index, a worldwide gauge covering more than 3,000 large and mid-cap companies, up 0.2 per cent to 286.0 and on course to close the day at its best ever level.

The All-World has risen more than 150 per cent since its financial crisis low of March 2009. The barometer’s previous closing high was the 285.8 touched in July 2015, before some end of year nervousness over the European economy and Ukraine contributed to volatility in recent months.

The latest leg up has been helped by a partial rebound for recently battered heavyweight resources stocks as the oil price bounced off multiyear low.

But arguably equity investors’s optimism is most buoyed by the continuing ultra-accommodative monetary policies of the world’s major central banks — a strategy that is suppressing the attractiveness of alternative fixed income assets by keeping sovereign bond yields at historic lows.


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