The Norwegian sovereign wealth fund publishes outcomes for the third quarter of 2024

The headquarters of Norges Bank, Norway's central bank, in Oslo, Norway, on Tuesday, January 30, 2024.

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Norway's giant sovereign wealth fund reported a third-quarter profit of 835 billion Norwegian crowns ($76.3 billion) on Tuesday, citing a stock market boost from falling interest rates.

The so-called Government Pension Fund Global, one of the world's largest investors, said it was worth 18.870 trillion crowns at the end of September.

The fund's total return for the quarter was 4.4%, 0.1 percentage points below the return of its benchmark index.

“We had positive returns in all of our investment areas. Falling interest rates led to a broad rise in the stock market,” Trond Grande, deputy CEO of Norges Bank Investment Management, said in a statement.

Stocks, which made up 71.4% of the fund in the third quarter, returned 4.5%. The return on fixed-interest investments, which make up 26.8% of the fund's assets, was 4.2% in the reporting period.

The results come shortly after Norges Bank Investment Management, which manages the world's largest sovereign wealth fund, warned that increased uncertainty and a “completely different geopolitical situation” meant there were now more risks to global stocks.

Norway's sovereign wealth fund, the largest in the world, was created in the 1990s to invest the excess revenue from the country's oil and gas sector. To date, the fund has invested money in more than 8,760 companies in 71 countries worldwide.

A global easing cycle is currently underway, with major central banks taking steps to tone down their aggressive stance on monetary policy as inflation falls in many high-income countries.

The Federal Reserve made a massive interest rate cut of half a percentage point last month. The Bank of England cut interest rates for the first time since the coronavirus pandemic hit in August, and the European Central Bank decided last week to cut rates for the third time this year.

However, the Bank of Japan kept interest rates stable last month as it remains cautious in normalizing monetary policy. The Japanese central bank is seen as something of an outlier in the global trend towards easing monetary policy.