Market Matters: March 31, 2025
Global equities declined, driven by a large sell-off in US stocks as investors digested the potential negative impact from new US import tariffs.
Authored by: Sehr Dsani
Market Matters: February 28, 2025
Global bonds rallied, outpacing equity markets as concerns mounted that a change in global trade dynamics would weigh on economic growth.
Are US Equities Set to Repeat the Dot-Com Bust of the Early 2000s?
No, we don’t think so. The quality of companies today is higher and speculative excesses are less extreme. However, risks are elevated in mega-cap tech stocks, though less pronounced than in the dot-com days, and we recommend modest tilts to developed markets small-cap and value equities to help balance portfolios.
Review of Market Performance: Calendar Year 2024
Most risk assets enjoyed strong returns in the calendar year (CY) ended December 31, 2024. US equities led on better-than-expected economic data and AI-related growth.
Market Matters: January 31, 2025
Global equities advanced in January as cooling inflation and US tariff delays catalyzed a risk rally in the second half of the month.
2025 Outlook: Public Equities
We expect developed markets value and small-cap equities to outperform, given our economic views and their steep valuation discounts. Regionally, we believe US equity performance will not match the level set in 2024, allowing European, Japanese, and emerging markets equities to perform more in line with broader developed markets. Within emerging markets, strong Indian equity gains should moderate, while we doubt Chinese equities will collapse. At the same time, we expect long/short equity strategies will perform better than typical.
2025 Outlook: Real Assets
We expect public infrastructure equities to perform similarly to developed market equities in 2025, propelled by supportive regulations for energy transition and strong demand for power infrastructure to fuel AI. While we believe US REITs should underperform US equities, US private real estate funds raised in 2025 should generate above-average returns, benefiting from distressed deals and solid fundamentals.
2025 Outlook: Currencies
We expect the US dollar rally will ultimately cool, with early strength giving way to modest weakening. Meanwhile, gold returns are likely to moderate in 2025 after a surge in 2024. Emerging markets’ use of stablecoins should support positive crypto returns, driving blockchain innovations and investment opportunities.
Private Infrastructure: Secular Themes Offer Compelling Opportunities
This note provides an update on the current opportunity set in infrastructure investments and highlights some of our preferred areas in the private space, including energy transition and digital infrastructure.
Market Matters: September 30, 2024
Global equities advanced in Q3. Monetary easing by several major central banks and a weaker economic outlook led to a rotation favoring value over growth strategies.