How global equity markets have soared since the first Covid lockdown two years ago today
On 23 March 2020, against the backdrop of plunging equity markets Prime Minister Boris Johnson announced the first national lockdown, telling people they would only be permitted to leave their homes for limited reasons, in a bid to stem the alarming spread of Covid-19.
Since that point the MSCI World index has risen 70.9% in sterling terms – which serves to support the argument that more often than not, the correct strategy for private investors at times of stock market panic is to sit tight, think long-term and remain invested.
Jason Hollands, managing director at investing platform Bestinvest, says: “No two crises are the same and the strength of the post-Covid crash rally was turbo-charged by record stimulus programmes from central banks, many of whom are now tightening policy. However, it is notable that since Russia launched its appalling invasion of Ukraine on 24 February, most developed market equity indices are have recovered to pre-invasion levels.
“This might surprise many given the escalating levels of aggression in Ukraine and gravity of the humanitarian crisis. What markets are indicating is that investors think a wider global recession is unlikely, despite the headwinds of surging inflation which are going to be exacerbated by rising energy and food prices.”
