Bordeaux Wealth Advisors’ Post

Almost one year ago in our quarterly letter, we discussed the rapid rise of interest rates that occurred in 2022-2023 and what might transpire in the economy, fiscal policy and the equity market. Check out Bordeaux Wealth Advisors' #q22024 market summary for our latest insights. #RIAs #wealthmanagement #insights https://lnkd.in/gVPvtTwK

Check out our Q2 Market Summary for our latest insights on interest rates, the US election, and long-term investment strategies.

Our Outlook for the 2nd half of 2024 is hot off the press! Outlook 2H 2024: Executive Summary We favour a more balanced positioning across and within asset classes. We believe that bond yields, including those on government bonds - something new for this segment - are attractive. Credit carry is attractive relative to corporate fundamentals, while long-dated government bonds offer protection in more difficult times in addition to their real yield. Favourable economic data and the prospect of interest rate cuts, i.e. the ingredients of the soft-landing narrative, together with solid quarterly earnings, justify a constructive stance on equity markets. However, we would like to see a broader participation in the market rally to reduce the fragility of the bull cycle that started in early 2023. While maintaining an allocation to the technology sector and the famous seven giants, we are balancing our portfolios with exposure to small/mid-caps and the value style, where valuations appear to offer significant catch-up potential.   Economic Outlook Real GDP forecasts lowered for the US and Japan. China and euro area upgraded Monetary easing becomes more widespread Fed and Bank of England will remain on hold until September and August, respectively FOMC dot plot implies only one 25 bps cut by year-end and four in 2025 Fannie Mae predicts that US mortgage rates will average 7% in 2024   Key Risks Sharper slowdown in the U.S. as labour market deteriorates sharply US/China and EU/China trade war intensifies Sovereign debt crisis forces governments to cut spending Populist drift at the ballot box, testing the foundations of our democracies   Investment Convictions Fixed income generally does well when the Fed pauses Long-dated government bonds as a hedge against renewed recession fears Inflation dynamics favour European over US rates (10-Year +) EM corporate bonds offer wider spreads and diversification benefits Prefer EU Fantastic Five to US Magnificent Seven Small/Mid-Caps offer compelling valuation and economic sensitivity Add value stocks for their relative valuation and diversification https://lnkd.in/e5hR3m3R The Forum Finance Group SA | Geneva | Switzerland

The latest Market Insights from Whittier Trust explores the growing complexity of the U.S. national debt and its impact on economic stability. With inflation slowing and monetary easing underway, new questions arise about fiscal policy, future growth, and the potential risks ahead. Discover how we assess the market implications of rising debt levels and why we remain confident in the economy’s resilience over the next few years. Read the full article here: https://lnkd.in/gBphzv7t #WhittierTrust #TrustWhittier #MarketTrends

Our Outlook for the 2nd half of 2024 is hot off the press! Outlook 2H 2024: Executive Summary We favour a more balanced positioning across and within asset classes. We believe that bond yields, including those on government bonds - something new for this segment - are attractive. Credit carry is attractive relative to corporate fundamentals, while long-dated government bonds offer protection in more difficult times in addition to their real yield. Favourable economic data and the prospect of interest rate cuts, i.e. the ingredients of the soft-landing narrative, together with solid quarterly earnings, justify a constructive stance on equity markets. However, we would like to see a broader participation in the market rally to reduce the fragility of the bull cycle that started in early 2023. While maintaining an allocation to the technology sector and the famous seven giants, we are balancing our portfolios with exposure to small/mid-caps and the value style, where valuations appear to offer significant catch-up potential.   Economic Outlook Real GDP forecasts lowered for the US and Japan. China and euro area upgraded Monetary easing becomes more widespread Fed and Bank of England will remain on hold until September and August, respectively FOMC dot plot implies only one 25 bps cut by year-end and four in 2025 Fannie Mae predicts that US mortgage rates will average 7% in 2024   Key Risks Sharper slowdown in the U.S. as labour market deteriorates sharply US/China and EU/China trade war intensifies Sovereign debt crisis forces governments to cut spending Populist drift at the ballot box, testing the foundations of our democracies   Investment Convictions Fixed income generally does well when the Fed pauses Long-dated government bonds as a hedge against renewed recession fears Inflation dynamics favour European over US rates (10-Year +) EM corporate bonds offer wider spreads and diversification benefits Prefer EU Fantastic Five to US Magnificent Seven Small/Mid-Caps offer compelling valuation and economic sensitivity Add value stocks for their relative valuation and diversification https://lnkd.in/eqWiZB7P

Within fixed-income, the Canadian corporate credit market has continued to outperform most of the domestic fixed-income space. This pattern is consistent with past trends, where the former tends to do well when the economy (real GDP) grows at a modest 1% to 2% annual clip. The latest market news from Scotia Wealth Management has been posted to our blog page. https://lnkd.in/eGZRByQG #stjohns #nfld #newfoundland #investing

Against a backdrop of solid growth and declining inflation, for much of the year so far investors have anticipated a series of US interest rate cuts, thus conforming to the perfect soft-landing narrative. It now looks as though that narrative is being challenged. Geopolitical tensions, coupled with a US economy that is running too hot for comfort, means that the possibility of a ‘no cuts’ base case on yield curves and issuance may well become a reality. What are the implications for fixed income investors?

Rising interest rates might feel unusual, but what if they're the "new normal"? Read our article to explore how investors can navigate a higher-rate environment and even find growth opportunities: https://tfoco.co/3woS2tD #InterestRates #InvestmentStrategies

📉 Q2 2024 CRE Finance Sentiment Update 📉 Sentiment among CRE finance executives fell in Q2 2024, reflecting increased caution about the economic outlook. However, some still see positive fundamentals in certain markets. 🔍 Key Takeaways: Increased Caution: Economic uncertainties and higher interest rates are driving a more cautious outlook. Positive Fundamentals: Despite the overall sentiment, certain markets continue to show strong fundamentals and opportunities. Let’s navigate these challenging times together and find the silver linings in the CRE landscape! 🌟 #CRE #RealEstate #Finance #MarketTrends #EconomicOutlook

Curious about the future of debt and equity costs in the CRE sector? Our Q1 2024 CRE Industry Conditions and Sentiment survey respondents share their 12-month forward view, highlighting expectations for lower debt costs and increased net IRRs. Don't miss out on the key findings! Download the full survey report on the Altus Group website: https://lnkd.in/gm-xznPU #commercialrealestate #CRE #realestate #realestatetrends #capitalmarkets