“GMO’s 7-Year Asset Class Forecasts for both stocks and bonds have generally declined in 2019, predominantly due to strong appreciation in asset prices,” said Rick Friedman from GMO’s Asset Allocation team.
Successful long-term investing depends upon the identification of sustainable companies. We believe traditional investment analysis tends to underestimate some risks faced by companies today.
The monthly factor report details those factors that influenced regional and global equity performance in July as well as over extended time periods.
For the most part, the second quarter saw a continuation of the first quarter’s positive performance across many asset classes. This furthered a reversal of the dismal 2018 when every primary asset class was negative.
The outperformance of defensive sectors relative to cyclicals is looking extreme in Europe, suggesting the macro trade around bond-sensitive stocks may have stretched too far.
The 11-year equity bull market is certainly getting long in the tooth, but several important indicators suggest we may not be at the end yet.
High-yield corporate bond spreads and bank loan discount margins typically widen when the Fed is lowering interest rates.
In today’s world of disruptive innovations, biotechnology is entering the most transformative phase our health care analysts have seen in 25 years. Since mapping out the human genome in 2003, drugs using new treatment paradigms—like gene and cellular therapies—have jumped out of laboratories and into the marketplace to tackle humanity’s most vexing diseases.
When macroeconomic growth slows, investors get edgy. But the economy isn’t the only thing that drives revenue and earnings growth for companies. Some industries are poised to expand at a rapid clip even if GDP growth is subdued or decelerating.
As we reach the midpoint of 2019, some investors could be feeling a little queasy from the market’s ups and downs. Our advice is to remain patient. Gain more insight from our latest client-approved Investment Outlook.
Trade issues continued to dominate headlines in June, with easing in US-China trade tensions providing a boost to emerging markets overall during the month. But Franklin Templeton Emerging Markets Equity cautions trade-related headwinds could persist. The team shares its latest emerging-market outlook and explains why the small-cap space looks attractive right now.
Shares in Alphabet have come under a good deal of pressure over the last year as investors process the implications of increasing regulatory scrutiny, culminating in reports this month that the U.S. Department of Justice (DOJ) is preparing for an antitrust probe into big tech.
Earning income without taking excessive risk is a balancing act—and it can be hard to pull off in the late stages of a credit cycle. A credit barbell strategy can help investors stay on their feet.
We continue to favor emerging markets equities, particularly emerging market value, and see some appeal in international value stocks. In the U.S., small-cap value is a pocket that has become quite attractive to us.
Tomorrow will obviously be one of the most important news days of the year for financial markets with the Fed expected at the very least to signal that a rate cutting cycle is in the offing.
Trade tensions caused investors to back away from emerging markets in May, but there are many reasons to be optimistic about the asset class and the earnings outlook ahead.
Market updates from across the region.
U.S. - China trade concerns continue to weigh on global markets. Matthews Asia offers its perspective on how the dispute affects the long-term investment landscape.
In this mid-quarter update, entitled “Escalation,” we discuss the backdrop of escalating trade wars and our belief that the environment is more favorable for US Treasury bonds relative to stocks.
Primed for growth, Asia’s health care sector helps capture consumer spending in the region.
African swine fever is ravaging China’s pork supply and having a global impact on protein prices. For equity investors, the crisis serves as a reminder that even amid trade-war uncertainty, research into domestic trends can help investors access the country’s vast stock market.
In the current environment, we believe the market had once again become overly complacent and so is reacting to noise. Perhaps it would be more accurate to suggest that the market is once again appropriately pricing risk back into the market.
Stocks dropped on Monday as the trade war between the United States and China escalated, with China announcing a retaliatory tariff hike on U.S. imports. The S&P 500 index closed down 2.41% and the Dow Jones Industrial Average lost 2.38%, their worst day in four months.
Many of your clients may face uncertainty about whether they should claim various investment income on their taxes and, if so, how. This is especially true in light of recent tax code changes signed into law — the first major revisions since 1986.
Franklin Templeton’s Emerging Markets Equity team walks through events moving emerging markets in April and discusses the three things the team is thinking about today. The team believes the current market environment provides an attractive entry point for investors, particularly in the small-cap stock space.
What a difference three months can make! Today, the bear has run back into its cave, the Fed has turned dovish, interest rates have plummeted, and stock markets have mostly recovered.
What a difference three months make. For the full year 2018, every primary asset class was negative: the S&P 500 lost 4.6%, commodities were down 13.9%, long-dated US Treasury bonds were down 1.6%, and gold gave up 1.9%. Contrast that with the first quarter of 2019 – every one of those assets was up!
Our forecasts have come down due to the extraordinary performance of equities and credit in the first quarter. However, we continue to find pockets of opportunity across equities: we believe value stocks are trading at attractive levels globally, and emerging markets value stocks are priced to deliver more than 7% above inflation.
Is the stock market correct in its optimism that monetary normalization is over and equities have more runway in 2019?
The latest market viewpoints from our equity and fixed income managers around the world.
Investors were dour heading into 2019 and while the mood became sunnier in the first quarter, there’s still plenty for investors to ponder and many potential threats to the relative calm.
Markets are caught between incoming data that point to slower global growth and forward-looking factors that suggest improvement later in the year. With the pause in U.S. Federal Reserve rate hikes, we expect modest recovery in global cycle conditions.
This letter explores examples of cognitive and behavioral biases that can derail even the best investment strategy if not identified and guarded against.
There has been a lot of talk the past few years about the flattening of the US yield curve—which is a graphical representation of the spread between short- and long-term interest-rate instruments. More recently, some market commentators have focused on the inversion of one part of the curve—and what it means.
Strong performance during the period was welcomed, but we remain frustrated by the persistence of what we see as a bear market in logic.
China's A-shares are gaining a larger role in MSCI indices. Matthews Asia's portfolio strategy team offers its views.
The Schwab Center for Financial Research’s theme for 2019 was “be prepared,” and that still holds true. Here’s what we expect to see for the remainder of the year.
A brief monthly update on what's happening in the municipal bond market.
Just over a decade ago, global markets began to recover from the biggest shock in postwar history. These 10 charts show both how much has changed since then and how post-crisis market conditions may influence the next decade.
Emerging market equities saw mixed performances in February, with stocks in Asia faring better than stocks in Latin America and emerging Europe, which underperformed.
We remain cautiously optimistic on emerging markets (EM) in 2019 despite a challenging 2018.
Powerful retailing disruptors are reshaping expectations about shopping and shipping by digitizing retail markets across the globe. New conveniences such as ordering groceries with a simple voice command are upending the old-world order.
Studies have shown over the years that most economic rate projections are terribly inaccurate with forecasts bunched together from crowd behavior. So what to do? Run multiple scenarios, assign probabilities and spit out the most likely base case at that point in time.
We expect the formation of collateralized loan obligations to remain a positive technical driver for loan demand through 2019.
A review of last month’s market-moving events across countries and asset classes.
Recent volatility has created opportunities to invest in high yielding leveraged credit closed-end funds trading at a discount to net asset value.
How swift will the high-yield recovery be? How likely is it to be sustained? History sheds some light.