After the broad-based downturn in 2022, most asset categories rebounded in 2023 against a backdrop of continued economic expansion and moderating inflation. Global stock and bond markets experienced a strong year-end rally as the US Fed signaled a potential shift to monetary easing. Yet, positive surprises for the economy, disinflation, and Fed rate cuts may be more difficult going forward with so much good news already priced in. While both the economy and financial markets begin 2024 with favorable momentum, we believe some caution is still warranted. In terms of tactical portfolio positioning, we remain underweight to US large cap stocks where valuations are stretched and perhaps reflect an overly optimistic outlook for near-term earnings growth. We recommend taking advantage of more attractive yields across fixed income sectors.
For further details please see the link here: CFO Market Backdrop and Outlook (Feb 2024)
If you have any questions or would like to discuss further, please don’t hesitate to reach out.