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Earnings buoy global stocks, bonds decline: Q3 roundup
October 7, 2026

Global equities rose modestly amid resilient corporate earnings and strength in energy and software companies. Among developed markets, U.S. and Japanese stocks delivered the strongest returns, while European equities declined. Emerging markets also lagged as concerns about the sustainability of AI-related spending weighed on sentiment. Overall, the MSCI All Country World Index (ACWI) climbed about 2%.


The energy sector posted the strongest gains, supported by higher oil prices amid supply disruptions related to the conflict in the Middle East. In contrast, utilities fell sharply as rising bond yields pressured dividend-oriented investments. Industrials also declined, partly reflecting tariff-related cost pressures.


Bond markets declined as rising energy prices and persistent inflation reinforced expectations for tighter monetary policy from major central banks. The U.S. Federal Reserve, European Central Bank and Bank of Japan each raised their benchmark interest rates by 25 basis points, pushing government bond yields higher and prices lower. The 10-year U.S. Treasury yield rose throughout the quarter, reaching its highest level in nearly two decades.


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MSCI All Country World Index is a free-float-adjusted market-capitalization-weighted index that is designed to measure equity market results in the global developed and emerging markets, consisting of more than 40 developed- and emerging-market country indexes. When applicable, results through December 31, 2000, reflect dividends gross of withholding taxes, and dividends net of withholding taxes thereafter. This index is unmanaged, and its results include reinvested dividends and/or distributions but do not reflect the effect of sales charges, commissions, account fees, expenses or U.S. federal income taxes.

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