Four years ago, the World Health Organisation declared Covid-19 a global pandemic [fe212a6d]. Equity markets plummeted and countries imposed lockdowns. Moderna commenced human trials on its mRNA vaccine, followed by positive results from Pfizer and BioNTech [fe212a6d]. Global equities bottomed out in March 2020 after massive intervention by the US Federal Reserve and stimulus packages from governments [fe212a6d]. The US equity market outperformed the rest of the world, while the MSCI China Index remains 30% below pre-Covid levels [fe212a6d]. The US dollar's strength penalized the returns of other markets, and US economic growth was more resilient [fe212a6d]. The US government's willingness to borrow money and its financial ecosystem supported US equities [fe212a6d]. The rapid shift to work-from-home boosted technology companies, particularly those involved in generative artificial intelligence (AI) [fe212a6d]. US earnings growth has been stronger than other markets, leading to higher valuations [fe212a6d]. Japan's stock market has seen recent strength due to companies becoming more shareholder-focused [fe212a6d]. The long-term prospects for the Japanese economy remain constrained by a declining population [fe212a6d]. The AI industry is still evolving, and the ultimate winners are unknown [fe212a6d]. While there are reasons to be circumspect, it does not appear that the market is in a bubble [fe212a6d]. Throughout this tumultuous period, staying invested in a diversified portfolio would have served most investors well [fe212a6d].
Global equities, measured by the MSCI All Country (AC) World Index, gained +9.6% in Q1 2024 [a33590e2]. Japan had the strongest regional gain, benefiting from improving global growth, stronger corporate governance, and normalizing inflation and rates [a33590e2]. The US made the strongest contribution to market progress. The S&P 500 was up +10.6% over the review period [a33590e2]. The rally in technology stocks is not equated to the dot-com bubble of the late 1990s [a33590e2]. The author recommends a 'barbell' approach to equities, with exposure to US innovation and emerging markets [a33590e2]. Short-dated government bills and US Treasuries are recommended for risk management [a33590e2]. Productivity gains and widespread AI adoption will determine the outlook for markets [a33590e2]. Geopolitical risks and the US election are factors to consider [a33590e2]. The author suggests that a new economic era could be unfolding [a33590e2].
Kazumasa Nagayama, President of Moderna Japan, emphasized the need to continue COVID-19 vaccinations as the virus shows no signs of decline and post-infection effects worsen [a129673e]. Moderna Japan is the only supplier of vaccines for the spring and summer of 2024 [a129673e]. Routine vaccination campaigns targeting the elderly and other demographics will start in the autumn and winter, with partial coverage of costs by individuals [a129673e]. Moderna is also developing a 'next-generation vaccine' for COVID-19 to be co-administered with the influenza vaccine [a129673e]. The vaccine has shown promising results in final-stage clinical trials, particularly among individuals aged 65 and above [a129673e].