Weekly Strategy Report (April 23, 2018)Contributor Multi-Asset Solutions
- FAANG stocks may have retreated from their 2018 highs, but global technology remains the best performing sector of the year in global equity markets.
- Recent jitters in technology can be thought of as growing pains for a sector that we believe is in a secular uptrend. The price discovery for data is only just starting, and the market is digesting its potential impact on earnings over the longer run.
- On a macro level, technology can act as a disinflationary force and over the long run a technology-led boost to productivity appears likely, although the timing cannot be predicted.
- In our multi-asset portfolios we favor U.S. and emerging market equities due to a solid earnings outlook and strong growth momentum, an allocation that also provides a positive tilt to the technology sector.
EXHIBIT 1: S&P 500 AND S&P 500 EX-TECH SECTOR POST-GFC*
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