Entering the last quarter of a historic year
The first nine months of 2022 will be remembered as one of the most challenging periods ever for asset allocators. Forthe first time in history, both equity and fixed income are down more than 10% as at the end of September.
Going forward, the main focus remains on inflation and how central banks are handling the situation, as the end of the bear market looks very much dependent on the timing of the “Fed pivot”.
In the first part of this publication we review the 10 stories to remember from the past quarter, which was characterized by a wide set of declines across most asset classes.
We then share the investment conclusions of our latest tactical asset allocation committee. Overall, we believe that there are still downside risks for the global economy, amplified by antagonist policies. We maintain an “unattractive” stance on equities and a cautious view on both rates and spreads. 2022 seems to mark a turning point in international relations, with major implications for the global economy and financial markets. In the “East-West” focus note, we discuss the macroeconomic and financial implications of a new world order.
In the last section, we present some attractive investment themes to consider in this challenging environment. While our forecasts and views are subject to changes, our commitment to serve our clients is not.
We remain at your full disposal for any specific issues you like to discuss, so please do not hesitate to contact us.