Market Insights

Now Available

Vantage Point - A Shot in the Arm

Welcome to the last edition of Vantage Point this year. 2020 has been extraordinary of course and, in many ways, a year to forget. We all hope 2021 turns out to be more ‘normal’ but, sadly, we can’t be certain of that just yet. The course of the disease remains the most important determinant of the economic recovery and there have been both positive and negative developments on this front since our last edition. The outlook for 2021 depends crucially on which of these bits of good and bad news dominates. We cover this reassessment and its impact on markets and investment conclusions in our new Vantage Point.
 

Monthly Market Roundup

February 2021

Positive 2H Outlook Still Intact

  • Global stocks experienced the first monthly decline since October and fell by -0.4%.
  • However, performance was mixed as emerging markets gained 3.1% and developed markets were -1.0% lower. In the US, large caps suffered (-1.0%) while the more cyclically-driven small caps delivered 5.0% and the Nasdaq was positive by 1.4%.
  • The US 10-year Treasury gained 15 bp to ~1.1% and is near the highest of the recovery since March.
  • While realized inflation remains low, signs of price pressure continue to grow as derived expectations have risen substantially.
  • A slower-than-expected vaccine roll out, rising Covid cases, the emergence of new virus variants, and accompanying restrictions have slowed growth and tempered near-term sentiment; however, the more positive 2H outlook remains intact.
  • Low consumer confidence remains a key concern along with slowing labor market progress.
  • Once the epicenter of the Covid crisis, China’s recovery continues to outperform.
  • The next round of Biden’s policy stimulus is heavily targeted to the consumer.
  • As the yield curve steepens, we continue to expect a rotation to more value and cyclical oriented areas of the economy.
Find out more

January 2021

Expectations for a continued economic recovery in 2021 lifted global stocks 4.7% bringing the 2020 gain to 16.8% and trailing two-year performance to 48.7%, the best in history.

Pricing in Continued Recovery

DOWNLOAD THE ROUNDUP

December 2020

Global stocks gained 12.4% in November, the best month in history.

Risk on Persists

DOWNLOAD THE ROUNDUP

 

 

 

Points of View

What’s priced into markets?

Household savings and corporate cash: igniting growth post Covid-19?

The global economic recovery remains uneven across regions and sectors but financial markets were buoyant over the last months of 2020 and have started 2021 strongly.

 

Read More

Inflation: Is It Coming Back?
 

Probably not in a big way, but if it were to it would change the investment landscape completely.
 

 

Read More

Global Economics and Investment Analysis Group

Meet the minds behind the research.

Shamik Dhar

Chief Economist

FIND OUT MORE

Alicia Levine, PhD

Chief Strategist

FIND OUT MORE

Liz Young, CFA®

Director of Market Strategy

FIND OUT MORE

Lale Akoner

Market Strategist

FIND OUT MORE

Bryan Besecker, CFA®, CAIA

Market Strategist

FIND OUT MORE

Sebastian Vismara

Financial Economist

FIND OUT MORE

MARK-138882-2020-09-03