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Global stocks declined, pressured by rising interest rates and slowing growth in some of the world’s largest economies. Even as global inflationary pressures subsided, indications that central banks may keep monetary policy tight weighed on stock and bond markets. Among major developed markets, Japan fared better than the US and Europe.

In the MSCI All Country World Index, nearly all sectors fell. Rate-sensitive utilities and real estate stocks posted the biggest losses. Information technology stocks also lost ground following a strong first half of the year. Meanwhile, communication services stocks outpaced the overall market, and the energy sector rallied on higher oil prices.

Bond markets tumbled as the US Federal Reserve (Fed) and other central banks expressed a need to keep interest rates higher for longer in a bid to fight inflation. The Fed hit the pause button on its rate-hiking plans, but the European Central Bank (ECB) continued to tighten in September, bringing rates to the highest level since the creation of the eurozone.