Our Global Investment Strategy service recently published their Strategy Outlook for Q2 2015.
The quarterly report highlights the following points:
- Global growth should remain broadly unchanged over the balance of the year, as stronger activity in most developed markets offsets a worsening outlook in emerging markets.
- A modestly pro-risk stance is warranted. Remain overweight global equities and corporate credit, neutral on government bonds, and underweight cash.
- Global bond yields will remain subdued as reflationary central bank policy takes center stage. The 10-year Treasury yield is heading to 1.5%.
- Overweight euro area and Japanese equities. Reduce exposure to the U.S. on valuation concerns and margin pressures. An overall underweight in EM equities is warranted, but China deserves to be bought.
- The commodity supercycle is over. There is little reason for oil or most metals to rebound anytime soon.
The dollar bull market is entering its final innings. While the greenback should be able to extend its gains against the commodity currencies and to a lesser extent, the yen, the pound, and the RMB, it will struggle to rise much further against the euro.
Clients interested in reading the full Report can access it here: Strategy Outlook Second Quarter 2015.