The mantra that gained popularity in the years after the financial crisis—bad news is good news—is back. That should remind investors that finding themselves on the wrong side of major central banks can be perilous.

The MSCI All Country World Index has erased all of the losses it suffered during a panicky end to 2018, when concerns about rising global interest rates alongside slowing growth sparked a sudden selloff. On Friday, the index finished slightly higher than its Dec. 3 close, and most Asian markets continued to rise...