This paper discusses recent trends in US commercial real estate fundamentals and looks ahead to what might be in store for the remainder of 2021. Overall, we are reluctant to sound overly bullish about the broad asset class, as the outlook for some sectors is unclear. Still, for investors looking to immediately deploy capital, we highlight two categories of opportunities.
Global equity markets advanced in first quarter, as developed markets equities topped emerging markets peers.
Risk assets rallied in February as global vaccination efforts progressed and economic momentum strengthened. However, the rally stalled in the latter half of the month amid concerns about a resurgence in inflation. Value stocks trounced growth. Small caps outperformed large caps for the sixth consecutive month. Sovereign bond prices declined amid sharply rising yields, while high-yield bonds advanced and bested investment-grade equivalents. Real assets mostly gained; oil prices reached their highest levels in more than a year, but gold declined at its fastest monthly rate since 2016. Among major currencies, UK sterling advanced, whereas the US dollar and euro were mixed.
This publication presents manager performance for 37 asset classes and substrategies, showing the median, mean, and key percentiles of return. Relevant indexes for each asset class are also included to provide market context.
Global equity markets declined in aggregate in January, but individual markets varied as emerging markets advanced and developed equivalents fell.
The onset of the COVID-19 pandemic caused steep declines in risk markets in first quarter 2020. Safe-haven assets, such as core sovereign bonds and gold, performed strongly during this period and have held on to much of their gains. Large-scale intervention by both monetary and fiscal authorities eventually put a floor under risk markets, driving rapid recoveries and pushing equity markets to new highs.
The risk rally continued in fourth quarter, bolstered by COVID-19 vaccine progress and multiple new stimulus measures.
Global equities ascended to new all-time highs in November, delivering their best monthly return since 1975.
Risk assets generally sold off in October, but investors found little respite in traditional safe-haven assets.
This publication presents manager performance for 37 asset classes and substrategies, showing the median, mean, and key percentiles of return. Relevant indexes for each asset class are also included to provide market context.