Market Compass November 2021
- The global recovery is set to continue, supporting corporate earnings and risk sentiment.
- Yet mounting uncertainties over the energy crunch and central banks’ response to a stickier inflation are making us more prudent.
- Despite incoming tapering and higher expected inflation, plunging real yields are a support for risk assets.
- We scale back our overweight in Equities and HY Credit, in favour IG Credit and Cash - both already OW. We keep a prudent short duration stance, anticipating only a gradual further rise in yields.