The cooling of inflation drives risky assets to rebound. Prudential Investment Trust said that the market will still be affected by inflation and interest rate hikes in the second quarter, but as the cycle of interest rate hikes comes to an end, the investment layout in the second half of the year can moderately include stocks and other risky assets. Target growth industries such as medical care and new supply chains that have growth opportunities.
Ye Jiarong, director of Prudential’s market strategy team, said that judging from the trend of US stocks, US bonds and the US dollar, the market has gradually reversed the short position, including S&P500 It has risen above the short-, medium-, and long-term moving averages. Although the U.S. bond interest rate is still trending upwards, it has fallen from a high level. In addition, the strong dollar last year is no longer there, which will help boost market investment confidence.
Ye Jiarong pointed out that observing the U.S. consumer price index (CPI) has shown a continuous month-to-month decline, falling from a peak of 9.1% to 5%, which shows that the 19 yards of interest rate hikes since March last year have had an effect, and the Federal Reserve also revealed this cycle of interest rate hikes It’s coming to an end.
According to IMF estimates, the economic momentum of most countries will continue to expand this year, and with the decline in oil prices and inflation, the global economy will simultaneously rebound from the bottom, including the leading index PMI comprehensive purchasing managers index shows that the global economic momentum has gradually bottomed out temperature.
Ye Jiarong pointed out that as the US interest rate will reach its peak, the weak US dollar pattern this year will drive the performance potential of emerging market stock markets. With China’s unblocking and economic restart, the current private savings rate in China has reached a high point since 2009, and a large amount of excess savings will become Emerging markets are the first to benefit from the driving force behind this year’s consumption growth, which has attracted international funds to replenish emerging markets starting this year.
Ye Jiarong suggested that as the economy is expected to restart growth in the second half of the year, prioritizing the layout of growth and niche industries and assets will be a good time to take advantage of the growth of risky assets such as stocks and bonds in the second half of the year, especially for companies with high competitive advantages , is expected to stand out from the market.
Fidelity Investment Trust stated that in an environment of long-term high interest rates, industries and regions with structurally favorable factors, defensiveness, and attractive evaluations have the opportunity to achieve a better balance between risk and return. In the long run , Sustainable development, demographic structure, and the return of industries to the local area or surrounding areas will continue to provide investors with attractive investment opportunities.
Taking the Chinese market as an example, Fidelity Investments said that compared with developed markets that have to deal with high inflation, rising interest rates and potential economic recession, the Asian market is benefiting from the restart of mainland China and tends to be optimistic.
Fidelity Investment Credit pointed out that the two sessions held in March this year reaffirmed the policy of maintaining growth. The economic restart in mainland China, supported by fiscal and monetary policies, and the recovery of public consumer confidence should stimulate a strong economic rebound, which will boost the market and bring investment opportunities.
