Underweight Housing stocks have been resilient to rising interest rates for the most part of the year, but now macro headwinds are taking over this consumer discretionary sub-sector and we recommend a below benchmark allocation. Rising…
Highlights Euro Area debt loads have increased significantly during the pandemic. Debt loads are not uniform. While Germany and, to a lesser extent, Spain look best, France has a less attractive total debt profile than Italy.…
The S&P 500 raced through the seasonally strong spring months rising by more than 10% from early March. Now, there is the chance that the US equity market will find it difficult grinding higher if the proverbial “sell in May and…
Highlights The ongoing transition to a post-pandemic state and fiscal policy are either positive or net-neutral for risky asset prices. Fiscal thrust will turn to fiscal drag over the coming year, but the negative impact this will…
Highlights The sharp drop in Chinese lending over the past year is highly likely to weigh on (non-oil) commodity demand and prices through the remainder of 2021. Commodity demand shocks dominate commodity supply shocks. Commodity…
Overweight The juggernaut trend in the US software & services industry is as strong as ever, and today we are reiterating our overweight call for this large sector. First, within the context of our recent…
Underweight Last month, we made a final defensive tweak to our portfolio and downgraded financials from overweight to neutral by trimming banks to below benchmark allocation. One of the reasons we focused on financials specifically,…
Highlights Tactically downgrade cyclical equities from overweight in Europe. The shift in global growth drivers, the beginning of the global liquidity withdrawal, and lingering COVID worries create headwinds for the cyclicals-to-…