From Pictet, April 10:
Pictet Wealth Management's latest positioning across asset classes and investment themes.
- While macroeconomic and corporate fundamentals still favour risk assets, challenges have been steadily increasing and a lot of good news is already priced into valuations. We sold part of our equity overweight during the early March rally.
- Even though we have become more prudent about equities’ short-term prospects, we expect to be able to redeploy the cash generated from this sale as new opportunities arise.
- The rise in volatility was fully expected but emphasises the need for caution. We are closely monitoring the market’s perceptions of the competitive and regulatory risks emerging for the small number of high-growth tech stocks that have led market performance.
- We remain optimistic about select parts of the US high-yield universe (less so euro high yield), with a particular emphasis on bond issuers in the upper reaches (BB) of the non-investment-grade ratings scale.
- Recent rises in oil prices will contribute to higher headline inflation until the middle of this year. Having reached around USD65 (our price equilibrium), there are signs the oil market may be moving toward oversupply....