Faced with a Tweeter-in-chief, how are investors to navigate what’s ahead? Is there a strategy behind President Trump’s outbursts; and if so, how shall investors position themselves to protect their portfolios or profit from it?
Investors would have done well in 2016 to heed the words of Heraclitus, paraphrased: “Expect the unexpected.” Brexit and the U.S. election results were two glaring examples of the unexpected becoming reality.
Donald Trump’s policies appear almost certain to contribute to volatility in Asian markets during 2017. For active fixed-income investors who understand the dynamics of bonds and currencies in the region, this creates opportunities.
Take Warren Buffett. He backed Hillary Clinton throughout the primaries and general election. And yet just yesterday, on the eve of Trump’s inauguration, he said he supported the new president and his cabinet “overwhelmingly,” adding that he’s confident America “will work fine under Donald Trump.”
On 11/4/16, the 65-day correlation between between the S&P 500 and US 10-year treasury yields was as negative as it had been at anytime since June 2007. The 65-day rolling correlation was -30% compared to a 73% correlation that had occurred just a few months earlier in June.
Global Strategist for Allianz Global Investors Neil Dwane says the rumbling sound being heard by politicians and power-brokers at the World Economic Forum in Davos comes from a new political avalanche of populism – one that threatens to sweep away decades of pro-globalization sentiment and change the investment landscape.
With U.S. stocks rallying, investors may be tempted to stick with a home country bias. Russ discusses why Japan is still worth a look.
For the first time since 2011-2012, inflation surprises are positive in many parts of the world. The Citi Inflation Surprise Index is at the highest level since 9/2011 in Asia-Pacific, it’s at the highest level since 10/2011 for the Eurozone, and it’s at the highest level since 5/2012 in the emerging markets.
There is much we don't know about how the Trump presidency will play out. Will the Wall get built? Who will pay for it? Will it have at least some fencing? Will repeal and replace happen at exactly the same time? Will Trump throw a ceremonial switch? Will there be a Trump National Golf Course in Sochi? It's anyone's guess.
While Chinese growth looks stable into early 2017, a more marked slowdown by the second quarter appears inevitable.
Higher interest rates, a stronger dollar and Donald Trump: three reasons to avoid emerging-market (EM) debt? Not necessarily. Rising rates seem to be signaling faster growth, and that’s good news for many EM bonds and currencies.
With Donald Trump about to be sworn in as US president, markets in Asia are nervous about some of his policies, especially on trade. Investors who are alert to these policies’ likely limitations could find attractive opportunities.
I gave you my own thoughts last week (see “Skeptically Optimistic”). Today we’ll review several other forecasts from people who deserve your attention. Of necessity, I must leave out some good ones, but I think the ones I cover will give you plenty of useful information.
One of the attempted barbs tossed my way at various points in the past 20 years is “Cassandra.” Frankly, I kind of like it.
Look at what President-elect Donald Trump’s pledge to lower taxes and slash regulations is doing to business optimism here in the U.S. Last month, the Index of Small Business Optimism soared a phenomenal 7.4 points to 105.8, its highest reading since 2004. The National Federation of Independent Business (NFIB), which conducts the survey, reported that attitudes toward capital spending and job creation in particular surprised to the upside. Research firm Evercore ISI called it a “blowout report,” and I have to agree.
The search for investment portfolio returns is not going to get any easier in 2017 against a backdrop of record U.S. equity prices, narrow credit spreads and low bond yields.
As the markets close the books on another tumultuous year, Neil Dwane, Global Strategist for Allianz Global Investors, says investors should keep watch on the rise of populist politics, China’s re-emergence as a global growth engine and a renewed focus on government spending as interest rates remain low.
Chinese local interest rates rose substantially late last year, and many bond offerings have been canceled, creating financial strain for some Chinese companies.
The last few days of 2016 have receded amidst continued pain for Asia's markets. Matthews Asia CIO Robert Horrocks, PhD, reflects on the year that began with a rally in Asia's equity and fixed income markets, but it ended in a slump.
Strong future growth is rooted in some basic dynamics in which Asia Pacific excels.
Factors ranging from China’s evolving economy to the rise of nationalism combined to make 2016 a year that will not be quickly forgotten.
In just a few decades, Vietnam has undergone a dramatic transformation, from an agrarian society to one that has embraced the modern era. Its youthful population and growing middle class have helped drive solid growth—and opportunities for many global investors.
2016 played host to the unexpected with the U.S. presidential election and Brexit vote. 2017 will bring its own events that could have consequences for global markets.
The nascent recovery in emerging markets has been thrown into question by Trump’s election. While the concerns warrant attention, we still see compelling reasons to invest in developing economies.
When America pursued “America first,” policies in the 1920s and 1930s, it brought on the Great Depression and helped sow the seeds of World War II. If US President-elect Donald Trump shifts US geopolitical strategy similarly toward isolationism and unilateralism, there is little reason to expect a better outcome.
Instead of trying to answer questions about the future, I’ll try to list those we should be asking as 2017 opens. These are the things that I sit and meditate about when I consider the future of economics, markets, and investing. Today’s economy is something like an old-fashioned Swiss watch. It’s a thing of beauty when all those delicate little gears mesh just right. If you ever take the time to actually study the inner workings of the marvelous manifestations of human ingenuity that keep us all alive, it is difficult not to come away awestruck by the ability of the human mind to craft such complexity. But if any of the gears get just a little out of whack, the entire contraption can grind to a halt.
At a time when the US is poised to turn inward, China’s economic performance is more important globally than ever. Whether China can achieve sustainable growth patterns in the coming years will depend on several key factors, the most important being internal
During his campaign, Trump took a restrictive trade stance that could hurt export-reliant countries in Asia—particularly China. But with continued rebalancing and a regional focus, Stefan Scheurer, economist with Allianz Global Investors, says China's influence in Asia could grow even bigger.
Investors have been drawn to real assets in general and to real estate in particular due to the comparative stability and attractiveness of their income returns and the prospects for growth.
What’s ahead for emerging markets in 2017? Stephen Dover, managing director and CIO of Templeton Emerging Markets Group and Franklin Local Asset Management, and Mark Mobius, executive chairman of Templeton Emerging Markets Group, present their emerging-market equity outlook.
The US has outperformed the MSCI World Index by over 26% since the 3/9/2009 low while the rest of the developed world has dramatically underperformed.
My colleague Carlos Hardenberg shares his perspective on the opportunities and challenges he sees in emerging markets today and as we head into 2017.
The 200-day correlation between US stocks and the MSCI World Index is currently 45%. This is the second lowest level since 2008. The only time the 200-day correlation was lower was in July 2014.
In Part 1 of this report, published on November 21, we discussed the geography of the Philippines and examined the nation’s history, focusing on its relations with the U.S. In Part 2 of this report, we will discuss President Rodrigo Duterte’s recent foreign policy decisions and their impact on U.S. policy in the region.
The aggregate market cap of our entire developed world index, GKCI DM, has remained mostly in the range of $35-40T over the last few years, after surpassing the $35T level (previously reached in 2007) in late 2013.
While I can’t always respond to each of your questions directly, I do enjoy hearing from my readers and followers and value your feedback.
As we look toward 2017, the general near-term outlook for international equities continues to appear somewhat mixed, given a combination of global macroeconomic risks.
Like many others, I was surprised by the results of the election. I guess I was persuaded by the polls that indicated that Hillary Clinton would win, even though the spread had shrunk to something within the margin for error.
It has certainly been a good couple of weeks for financial stocks. But the good times still haven’t been good enough to bring bank stocks out of last place among 24 developed market industry groups.
The board’s expertise constitutes a valuable input into our investment process.
President-elect Donald Trump promises that one of his very first actions when in office will be to withdraw the United States from the controversial Trans-Pacific Partnership (TPP), which was finalized earlier this year but must still be ratified by all of the participating nations.
A year ago, profits for companies in the S&P had declined 15% year over year (yoy). The consensus believed this signaled the start of a recession in the US. How has that dire prognosis worked out? In a word: terrible.
Many of the policies President-elect Trump discussed on the campaign trail align with current and past GOP tendencies but others seem diametrically opposed to GOP DNA.
More than one out of five developed market stocks and more than two out of five emerging market stocks are in a bear market (down over 20% from a high) in the past 200 days.
In May, Rodrigo Duterte was elected president of the Philippines. An unconventional political figure, he is considered populist in the mold of Turkish leader Recep Erdogan or Indian PM Narendra Modi. Perhaps most controversially, Duterte has embraced China and rejected its long-standing ally, the US.
Abhay Deshpande founded Centerstone Investors and serves as the chief investment officer. He previously worked at First Eagle Investment Management with Jean-Marie Eveillard. In this interview, he discusses the opportunities he sees for his two recently introduced value funds.
