Wall Street and U.S. stock markets closed sharply higher in January, but a number of global markets have left us in the dust. Select foreign stocks and funds posted double-digit gains last month. Here are a few of the world's leaders.
The U.S. dollar peaked in September and has dropped significantly since that time. The rapid deterioration rivals the plunge in the three months following the March 2020 pandemic peak. According to DataTrek, this pattern can produce a further drop, which it expects in 2023.
The weakened greenback has incentivized global investors to look elsewhere for growth. Some global markets have already had big runs, which may be unsustainable, so investors should take heed.
The S&P 500 rose 6.2% January while the Dow Jones Industrial Average posted a modest 2.8% gain. The beaten-down Nasdaq composite led the pack, rising a hefty 10.7%, its strongest January since 2001.
Let's see how these numbers compare with the rest of the globe.
Global Markets: Mexico Rallies Double Digits In January
Mexico led global markets in January, as represented by the iShares MSCI Mexico ETF. The fund rose 16.6%, according to Dow Jones Market Data.
Mexican airport developer Grupo Aeroportuario gained 16.7%, with passenger travel surging 23% from 2019. Tourism is an important sector for the Mexican economy.
Germany trailed Mexico, but came in strong, with the iShares MSCI Germany ETF rising a hefty 13.4%.
German GDP rose 1.9% in 2022, an increase of 0.7% over 2019, despite high energy prices, the war in Ukraine, inflation and other headwinds. Ruth Brand, president of the Federal Statistical Office, noted that "although these difficult conditions persist, the German economy as a whole managed to perform well in 2022."
Inflation has shown recent signs of slowing in European countries, including Germany and France.
The iShares MSCI France ETF added 11.6% while the iShares MSCI UTD United Kingdom ETF gained 6.2%.
China Stocks Also Strong
In other global markets, the iShares MSCI China ETF spiked 12.4%.
Largest-holding Tencent Holdings soared 21.1%. Online retailer Alibaba, second-largest component, rallied a whopping 25.1%. Internet search giant Baidu jumped 17.8%.
Asia continued to impress, with iShares MSCI Taiwan ETF gaining 11.6%. iShares MSCI Korea ETF increased 12.4%, led by Samsung.
The iShares MSCI Australia ETF added a lofty 11.8%. Looking at South America, the iShares MSCI Brazil ETF rose 8.5%.
Lastly, India was a global laggard, with the iShares India 50 ETF dipping 0.1% to start 2023.
Follow Kimberley Koenig for more stock news on Twitter @IBD_KKoenig.
