The Week in Markets: Fog of war clouds the outlook for markets
The global economy is navigating a complex landscape of rising oil prices and increasing inflationary pressures. Following last week's conflict between Israel and Iran, oil prices have surged over 12%, and concerns are growing about the potential impact on economic growth and stability. Yet, despite these challenges, certain economies - such as India's - are demonstrating resilience and attracting investor attention due to their strong fundamentals and long-term growth prospects.This episode is presented by Mark Matthews, Head of Research Asia at Julius Baer.
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14:05
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14:05
Market Outlook Mid-Year 2025 – Investing in a multipolar world
The first half of the year has provided investors with ample food for thought, but what’s next and how should investors be positioned for the second half of the year? In this episode of the Beyond Markets podcast, Christian Gattiker, Head of Research, and Mark Matthews, Head of Research Asia, discuss with Helen Freer the impact of the US administration on the global economy, the importance of adopting a global investment approach, and the current opportunities, particularly in the equities and fixed income space.(00:33) - Introduction
(00:53) - US policies and what it means for the global economy
(03:33) - Risk of a recession
(05:03) - Expectations for the US Federal Reserve
(06:31) - Investing in equities - diversify
(07:44) - Why focus on mid-caps?
(10:01) - Opportunities in India and China
(11:28) - Why do we like Japan?
(12:32) - The importance of stock-picking in the current environment
(14:40) - Should gold form part of an investor’s allocation?
(15:47) - Where does the US dollar go from here?
(17:04) - Is the Swiss franc the ultimate safe-haven currency?
(17:44) - What does the global trade policy uncertainty mean for credit spreads?
(18:55) - Opportunities in the fixed income space
(19:44) - What do we prefer in terms of duration?
(20:29) - Opportunities in Euro bonds
(20:52) - What’s in store for emerging market debt?
(21:34) - Next Generation: a barbell strategy with Extended Longevity and Future of Finance
(23:41) - Next Generation: Future Cities
(24:15) - Summary
(25:29) - Conclusion
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27:21
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27:21
The Week in Markets: US pessimism prevails
US assets slumped last week, with the US dollar, Treasuries, and stocks selling off following President Trump's warning of fresh tariffs on the European Union. The pessimism on US assets is also reflected in recent data. The preliminary University of Michigan consumer sentiment index dropped to 50.8 from 52.2 in the month, and surveys show that Americans intend to do fewer road trips this summer despite falling gasoline prices.Investors are now seeing merit on diversifying out of the US, and gains have been seen in local currency stocks and bond markets. Local currencies have also performed well, with the weaker greenback creating opportunities for Asian central banks, such as Bank Indonesia and the Reserve Bank of Australia, to cut rates. In Hong Kong, the slump in the US dollar pushed the Hong Kong dollar towards the strong end of the band, prompting intervention from the Hong Monetary Authority (HKMA) to defend the currency peg. We expect more abrupt interventions from the HKMA from here, as investor positioning and flows are likely to weigh on the Hong Kong dollar and HIBOR.This episode is presented by Magdalene Teo, Head of Fixed Income Research Asia at Julius Baer.
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5:54
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5:54
The Week in Markets: The beginning of the end of US exceptionalism?
In this episode of the Week in Markets, equities research analyst Louis Chua explores how the equity and debt markets have reacted to the 90-day truce in the trade war between the US and China, and what are some of the lingering concerns to watch over the next 90 days. Overall, while the financial markets have reacted with relief, we believe that the US fiscal situation remains far from being solved, and we would take advantage of the current opportunity to add diversifying exposure outside the US. In the long term, an end to US exceptionalism and foreign investors’ asset allocation decisions to diversify away from the US can have a significant impact to equity and fixed income markets.
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9:17
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9:17
The Week in Markets: Hitting the pause button
The US and China have agreed to a 90-day truce in the trade war, following negotiations in Geneva. As part of the deal, the US will reduce tariffs on Chinese imports from 145% to 30%, and China will lower its duties on American goods from 125% to 10%. Markets have welcomed these developments, but key questions still remain about the implications for the economy and inflation. This uncertainty puts the Federal Reserve (Fed) in a tough spot, and we await more clarity on the Fed’s direction from Fed Chair Jerome Powell’s comments on 15 May. In Asia, the India–Pakistan conflict has calmed following a US-mediated ceasefire. We note that historically markets have typically recovered within a month of previous India-Pakistan conflicts, and continue to monitor key indicators such as the Indian Rupee and Foreign Institutional Investor (FII) flows, as well as geopolitical developments. This episode is presented by Chintan Bhindora from the Julius Baer Research Asia team.
“Beyond Markets” by Julius Baer is a series featuring conversations with experts to share recent market developments, key insights, and strategic inputs from around the globe. In each episode, we cut through the noise to offer practical advice and macro research on today’s shifting economic and market landscape.
The information contained in this podcast is marketing material. Opinions expressed do not constitute independent financial/investment research, investment advice, or an offer to buy or sell securities by Julius Baer. Please refer to www.juliusbaer.com/legal/podcasts for important legal information prior to listening to this podcast.
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