A TALE OF TWO ASSETS BY: KEZIA SAMUEL, CAIA INVESTMENT COMMITTEE MEMBER SENIOR VP, CHIEF PORTFOLIO STRATEGIST
So far, 2019 has proven to be a very different year in markets compared to 2018. Prospects of a U.S./China trade deal and a “patient” Federal Reserve (Fed) have led to a sharp rally, reversing the losses experienced in 2018.
Global stock and bond markets are painting two different forecasts of the global economy: Stocks have soared from December lows, reflecting positive investor sentiment, while bond yields have fallen. Bonds have also posted positive returns, reflecting worsening economic conditions.
The economy continues to grow in 2019, albeit at a slower pace, and the probability of a recession remains low. These factors should support a healthy stock market over the intermediate term.
In the near term, investors should remain cautious when market sentiments go from being far too pessimistic in December 2018 to far too optimistic in 2019 – a long way for the pendulum to swing in such a short period. Click here to read more.
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