- “Now the hard part”, we warned last month. Market sentiment has turned even faster than we feared, on worsening US/China trade talks, fattening Hard Brexit tail risks and renewed Italian fiscal woes.
- With political uncertainties and risks to international trade and supply chains rising, we further reduce the pro-risk tilt in our portfolios. We cut our overweight in equities to a minimum.
- Thanks to solid labor markets and consumption, accommodative central banks and investors’ desperate search for yield, however, we do not throw in the towels altogether. We see selected opportunities e.g. in longer-dated corporate bonds.