GLOBAL - International small-cap companies were the driving force behind strong gains for developed world equity markets in 2004, says ratings agency Standard & Poor's (S&P).
According to the agency, the S&P/Citigroup BMI Developed World Index rose 16.9% in US dollar terms in 2004, helped in part by a 3.93% return for the index in December.
Commenting on the results, Nicholas Aninos, analyst at S&P said: “In 2004 there were several factors working in favour of equity markets. Adding to the strong returns were a US economy gradually beginning to pickup steam, low inflation arguably being held in check by intense global competition, and a favourable interest rate environment.”
All major regions posted gains for December and finished 2004 in positive territory, S&P noted.
For 2004, Europe came out on top, returning 22.8%. Asia Pacific came in second, returning 20.72% and North America returned 13.19%.
S&P said small-cap companies (those under US$2bn) finished ahead of their large-cap counterparts across all developed regions. The Developed World small-cap companies returned 25.07% while large-caps returned 13.27% in 2004.
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