Although there were signs of global economic recovery during the month, share prices were held back by investor concerns about the health of corporate profits in the wake of the collapse of companies such as Enron and Global Crossing.
Brazil was the world's best performer over the month on signs that the economy is pulling out of recession and on hopes that Congress would cut tax on share trading.
In terms of sectors, it was yet another bad month for technology and telecom stocks. Despite both sectors experiencing a brief rally in the autumn, investors are once again questioning the profit outlook and valuations of tech and telecoms stocks.
The best performing sectors were cyclical, such as engineering and forestry, whilst the defence sector received a boost from a planned increase in US defence spending following last year's terrorist attacks.
The world's best performing individual stock was Hindustan Petroleum, which benefited from increasing speculation that the Indian government would shortly sell off stakes in many of its state-controlled businesses.
Japanese banks also performed well, despite all their problems, on speculation that the government would be forced to bail out the sector.
The list of worst performers reflects the market's focus on accounting issues. Energis, the UK telecoms group was the world's worst performer as it said it expected to breach its banking covenants; while both Enterasys Networks and Computer Associates saw their shares fall sharply after the announcement of Securities and Exchange Commission investigations into the companies.
FTSE Mondo Visione Exchanges Index:
FTSE Monthly World Markets Report February 2002
Date 04/03/2002
World equity markets had another difficult month in February, with the FTSE All-World index falling 1.1 per cent in dollar terms, according to information compiled by FTSE, the global index group.
