Additionally, they seem to support something I dropped en passant in our first comment on the Paris ClimateFest®:
...More to come but for now it looks like it's back to the daily grind, maybe front-run the shift from growth to value, except the reinsurers, short the reinsurers, the bastards.I hope next year's hurricanes go straight to Zurich. And then Munich.And who doesn't like a little biased confirmation of their confirmation bias?
From Bloomberg:
- DNB says drop in commodities also getting `long in the tooth'
- DNB says room for profit margins to increase in Europe
For the unit at Norway’s biggest bank deciding how to invest client funds, 2016 will be a pivotal year as it predicts the rally in the U.S. dollar will finally come to an end.
DNB Asset Management, which oversees about $60 billion, is adjusting its portfolio to profit from its forecast for a less buoyant dollar and a recovery in emerging markets and commodities.
“The dollar rally we’ve had over a period, and not least the commodity price fall we’ve had, have become long in the tooth,” Per-Erling Mikkelsen, head of tactical asset allocation at the asset manager of DNB ASA, said in an interview in Oslo . “There’s a probability that we can suddenly end up with another regime a bit into 2016 than we’ve had the last years.”
For now, that is still a bold prediction. The greenback posted its best week since the start of November as traders bet on more rate increases from the Federal Reserve after it raised rates for the first time since 2006. The dollar has strengthened by about 23 percent since mid-2014 against other major currencies, mainly because of sluggish growth in Europe where central banks are still mostly cutting rates.
“We are most positive to regions where pricing and margins are more reasonable than for example the U.S., namely Europe and Japan, which also have a bigger support on the liquidity side than the U.S.,” he said. “In Europe, there’s room for margins to increase while margins in the U.S. have compressed.”
In a low interest rate environment, investors have been seeking returns from other asset classes than fixed income. That has increased valuations of especially defensive, high-quality dividend stocks, according to Mikkelsen....MORE
