World News: 21:00 GMT Thursday 6th December 2018. [Macquarie Investment Management via Businesswire via SPi World News]
Macquarie Investment Management today issued its 2019 Global Investment Outlook, affirming that trade tensions, tightening monetary policy, and potential inflation will affect most asset classes and may lead to an inflection point for investors. In the report, titled The Way Forward: 2019 Global Investment Outlook, Macquarie investment experts provide in-depth views across equities, fixed income, real assets, and other alternative markets.
“In 2018, the story was all about US performance and volatility, which cast a shadow over other markets,” said Shawn Lytle, deputy global head of Macquarie Investment Management and president of Delaware Funds® by Macquarie. “As we enter 2019, all eyes will be on rising rates, trade tensions, and inflation fears. Given this backdrop, we see a broad array of investment opportunities for active managers.”
Following are highlights of the firm’s 2019 outlooks for specific asset classes:
“We have been in a sustained period of an extreme lack of volatility in most developed markets and almost lulled into thinking it’s the new normal,” said John Leonard, global head of equities for Macquarie Investment Management. “History would suggest that’s not the case. We have already seen volatility ratcheting up this year, and Macquarie believes it’s likely to come back in 2019.”
Macquarie sees the following market themes across its 12 boutique equity investment teams:
Global fixed income
In 2019, Macquarie expects that fixed income markets could be marked by some of the same forces affecting 2018 — divergence in growth between the US and the rest of the world, the effect of rising interest rates, and other vulnerabilities exposed by the receding tide of accommodative central bank policy.
“When the weather report warns of low visibility, you know to expect a reduced line of sight,” said Roger Early, global co-head of fixed income for Macquarie Investment Management. “We think that’s an apt description for global fixed income markets as we enter 2019.”
Key expectations include:
“A trade war is a huge uncertainty,” said Brett Lewthwaite, global co-head of fixed income for Macquarie Investment Management. “If the talk on restrictive trade escalates to policy, it might cause a partial walk-back of the strong benefits of globalization, which could create complexities and challenges for many multinational corporations. The path forward is not clear, but it is evident we’ve gone from an in-sync world to one marked by divergent interests.”
Real assets and alternatives
“Slowed US growth in 2019 means investor attention could turn toward China, Japan, and emerging markets,” said Stefan Löwenthal, chief investment officer for the global multi-asset team, Macquarie Investment Management. “With the US growing at 4%, for example, suddenly emerging market growth of 4% to 5% doesn’t seem so hot. We find there’s no need to assume emerging market risk if the growth is on par with the US. The US just overshadowed every other market, but we might see a reversal in that sentiment.”
Key expectations include:
To view the complete 2019 Global Investment Outlooks, visit: macquarieIM.com/outlooks
About Macquarie Investment Management
Macquarie Investment Management is a global asset manager with offices throughout the United States, Europe, Asia, and Australia. As active managers, we prioritize autonomy and accountability at the team level in pursuit of opportunities that matter for clients. Our conviction-based, long-term approach has led institutional and individual clients to entrust us to manage $US253.3 billion in assets as of Sept. 30, 2018. In the US, retail investors recognize our Delaware Funds by Macquarie as one of the longest-standing mutual fund families, with more than 75 years in existence. Macquarie Investment Management is a division of Macquarie Asset Management, a global asset manager with $US397.2 billion in assets under management as of Sept. 30, 2018.
Investing involves risk including the possible loss of principal.
The views expressed represent the Manager’s assessment of the market environment as of the date indicated and should not be considered a recommendation to buy, hold, or sell any security, and should not be relied on as research or investment advice.
Duration measures a bond’s sensitivity to interest rates by indicating the approximate percentage of change in a bond or bond fund’s price given a 1% change in interest rates.
The S&P 500 Index measures the performance of 500 mostly large-cap stocks weighted by market value and is often used to represent performance of the US stock market.
Business Wire: 21:00 GMT Thursday 6th December 2018
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