There is an old Chinese curse that threatens “may you live in interesting times.” It has rung true for several years now. But after much kicking of cans we remain hopeful, if not complacent, about the chances of returning to a world driven by economic fundamentals. Our expectations for equity markets over the coming twelve months are therefore positive, driven by companies benefiting from low interest rates and modest growth.
The conundrum of 2012
2012 provided something of a market conundrum. After all, equities rose around 10% and credit spreads tightened, suggesting a benign economic environment. But those equity returns came despite their antithesis, government securities, also remaining strong. The standard explanation is that the flood of liquidity dispensed by central banks provided a tide that raised all boats. More>
Head of Portfolio Strategy