Three themes have emerged to challenge the Goldilocks narrative that supported risk assets through the second half of last year: signs of diverging growth across major economies, a stronger US dollar and material risks of a broadening trade war. These ‘three bears’ are likely to make for a much more challenging environment for risk assets going forward.
While political news continues to move markets, there are reasons for optimism. Our allocation stance remains unchanged.
Bonds are likely to take the upper hand over equities this summer, as liquidity dries up and economic growth slows.
Die Emerging Markets haben mit Wachstumsschwierigleiten zu kämpfen, daher lohnt ein Blick auf neue Wachstumsmärkte.
While political uncertainty remains a source of volatility, there are reasons for optimism. Our allocation stance remains unchanged.
Emerging market assets have been under pressure for several months. Initially, this was triggered by higher US interest rates and a stronger USD. This was exacerbated by concerns about external fragility, notably in Argentina and Turkey, and the resulting outflows from the asset class.
Trade tensions are still a dominant theme for the risky-asset markets. We maintain a small risk-on stance.
The Corporate Credit Team at Janus Henderson Investors looks at some of the factors that are encouraging them to be cautious towards companies operating in the debt collection sector.
“It’s been a tough few weeks with plenty to worry investors such as Italy and US trade tensions. But there’s no need to panic as yet,” says Luca Paolini, chief strategist at Pictet Asset Management.
Markets were hit by shocks coming from three sources in May: an escalation of political risk related to Italy, weakening growth (notably in Europe); and a stronger USD, which led to stress in emerging markets.
