Edmund Brandt and Ed Walker write in their capacity as investment directors. Their asset allocation views are based on a 12-month time horizon and reflect the input from various investment teams within J.P. Morgan Asset Management. These discussions are considered by Edmund and Ed before they ultimately produce their allocation views on the regions in terms of underweight, neutral or overweight.
March produced strong equity returns, continuing the rally from February's lows
In March, the MSCI World Index returned 5.3% in local currency terms. All major developed markets produce positive returns, led by Hong Kong (+9.5%) and the US (+6.8%). In local currency terms Europe rallied less (+2.8%), but due to the strength of the euro, returns in US dollar terms compared favourably to other developed markets, returning 7.8%. Emerging markets outperformed over the month, with many markets delivering double-digit returns. Brazil led the way, gaining 16% in local currency terms and 31% in US dollars, on hopes of political change. Signs of stabilisation in China and higher commodity prices drove emerging markets higher across the board. Emerging market currencies were also generally firmer, contributing to strong gains in US dollar terms. Overall, the MSCI Emerging Markets Index increased 8% in local currency terms and 13% in US dollars.
Coming up in the Bulletin:
- The Fed has turned more dovish: US economic fundamentals remain little changed
- Global growth signals remain mixed and earnings estimates remain under pressure
- Upgrading emerging markets to overweight
- We retain our neutral stance to equities
- Asset allocation
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