Despite the continued overhang of war and tariffs, equity markets marched on. The MSCI ACWI (All Country World Index) ex USA returned 2.59% for the month and 17.39% year-to-date (January 1-August 31, 2026). The MSCI US Index was up 2.76% for the month and 13.04% year-to-date.
MSCI’s International Developed Market Index was up 2.21% for August.
The MSCI Developed European Index was up 1.44% in August. Albeit small, Ireland was up by 9.1%, led by good performance of AIB bank. UK, the largest component of the index, was only up .74%. Some mining and tech companies did well, but there was rotation out of larger defensive stocks whose dividend yields looked less attractive versus higher government bond yields. Year-to-date, The MSCI Developed European Index was up 11.67%.
Japan, the largest market in The MSCI’s Pacific Index, was up 3.35% in August buoyed by some of its top ten holdings, including: Mitsubishi UFJ, Toyota and Tokyo Electron. A prospective Chinese tax on overseas insurance policies impacted the share price of AIA Group, the largest company in the HK index, which was down .41%. The MSCI Pacific Index was up 3.08% for August and 19.71% year-to-date.
Canada reported stronger than expected economic growth in the 2nd quarter. Despite the overhang of prospective US tariffs on a wide range of Canadian goods, The MSCI Canadian Index was up 3.68% for the month and 14.87% year-to-date.
Year-to-date, MSCI’s Developed Market International Index was up 14.32%.
The MSCI Emerging Markets (EM) Index was up 3.40% in August, which Bloomberg credited to a rotation away from US dollar-denominated assets and broadening of market participation. Indeed, MediaTek and SK Hynix, rather than Taiwan Semiconductor, the largest stock in the index, were more important drivers of aggregate emerging market performance. Year-to-date the MSCI EM index was up 24.35%.
A search on the outlook for international equity markets for the rest of the year returns results from Schwab, Fidelity Morningstar and various investment managers. Reflecting on their and my observations, I am of the opinion that due to attractive valuations, upswings in global manufacturing, selective improved corporate governance and investments in AI infrastructure, there remain attractive investment opportunities. The attractiveness of each opportunity, however, needs to be balanced with the risk of energy shocks, global inflation, stick interest rates and geopolitical uncertainty.
Disclaimer: This material is intended for educational purposes only. You should always consult a financial, tax, or legal professional familiar with your unique circumstances before making any financial decisions. Nothing in this material constitutes a solicitation for the sale or purchase of any securities. Any mentioned rates of return are historical or hypothetical in nature and are not a guarantee of future returns. Past performance does not guarantee future performance. Future returns may be lower or higher. Investments involve risk. Investment values will fluctuate with market conditions, and security positions, when sold, may be worth less or more than their original cost. All statements made regarding companies, securities or other financial information contained in the article are strictly beliefs and points of view held by Bastion Fiduciary and are not endorsements of any company or security or recommendations to buy or sell any security.