For many stock markets a virtuous combination of low inflation and steady economic growth meant big gains, helping push the Financial Times/Standard & Poor's World Index 13 per cent higher in dollar terms.
Among the emerging stock markets, investors lucky enough to be in Turkey (up 250 per cent), Morocco (up 34 per cent) and Egypt (up 100 per cent) did particularly well. "Economies in the Mediterranean and Middle East have, by and large, been particularly well run," says Angus Blair, of ING Barings, a firm of investment bankers.
Similarly the prospect of future stable economic policies in Russia has rubbed off on its fledgling equity market, up 105 per cent during 1997. "With more good news to come," says Nicholas Vardy, of Henderson Investors, a fund management group."
Outside these exotic and high-risk markets that tend to cater for the institutional or professional investor, Switzerland and Italy proved to be the stars of 1987. The New York, Frankfurt and Dublin indices also netted gains well ahead of those in London.
So will 1998 offer better returns for investing abroad than at home? Market strategists casting the runes say 1998 could turn out to be one of the toughest years yet.
In the Far East the threat of default among the leading "tiger" economies coupled with the continuing recession and high-profile corporate collapses in Japan and South Korea will haunt equity markets there. Given the scale of the fall-out from Pacific markets in 1997 it is hardly surprising that market strategists are divided on the scope for recovery during 1998.
Some say the fall could provide a buying opportunity. "Some of the Asian markets which went early into the crisis may see the turning point in the first half of 1998," says Joe Rooney, of Lehman Brothers. But Peter Chambers, of HSBC James Capel, thinks "bankruptcies, poor earnings and the continued insolvency of the region's banking system" will continue to sap confidence.
Analysts remain hesitant about calling the bottom of the Tokyo stock market. Michael Hughes, group economic adviser at Barclays, thinks it will provide trading opportunities but not much scope for solid growth.
In New York, Wall Street is waiting on the next interest rate move from Alan Greenspan, chairman of the Federal Reserve. Too heavy a touch on the brake and shares could see the start of a sustained bear market. Perversely, however, the crisis in Asia could help slow the surging US economy.
If the Far East is low then New York is high. Mr Hughes believes the "rerating of the equity market on Wall Street is complete" because of the surging dollar and potential rises in interest rates that could cap earnings growth. "It makes us bigger bulls of US bonds than of equities," he says. Not much joy there for the international growth investor.
Europe might appear to be off-limits for the international growth investor as well. Economic and Monetary Union has long ceased to be a twinkle in the eye. Participating members are now having to think seriously about the harmonisation of monetary and eventually fiscal and industrial policy to meet the Maastricht criteria. As a result, opinions are divided as to whether Continental stocks offer good value. Some see the imminent introduction of the euro currency as an opportunity for companies to cut costs and begin an orgy of mergers and acquisitions. However, others, such as Mr Rooney at Lehman Brothers, see a single currency as a dampener on prices, profits and earnings in the short term while putting upward pressure on wages through the Social Chapter.
If there is an element of consensus among strategists it seems to be on Latin America. For some it is their biggest "buy", citing the improving economic situation there combined with a grudging forgiveness for the Mexican crisis of 1994.
But for many analysts the advice is to stick with UK shares rather than be abroad in 1998. Share prices here are not yet unreasonable, they argue, and the suggestion is that the UK is divorced if not fully detached from global financial turbulence.Reuse content