A market that defies stereotypes

20 min read 8 Jul 22

Please find below our inaugural combined Quarterly Outlook from the M&G Equities Team.

This piece has commentary from each investment desk (Global, UK, EM, Asia, Impact and Convertibles) with a foreword from Fabiana Fedeli, CIO Equities and Multi Asset.

  • After steep price declines, a lot of the heavy lifting has been done but the risk is still to the downside.
  • The current market is defying traditional stereotypes of ‘value’ vs ‘growth’ and ‘defensives’ that are not so defensive. Stock selection remains key.
  • Second-quarter earnings season will be the great leveller and sift the wheat from the chaff. Consensus forecasts remain too high.
  • The sell-off has provided selective opportunities, particularly among technology names, more to come.
  • We continue to favour long-term themes, such as infrastructure and the low-carbon ecosystem, able to benefit from investment ahead, independent of the vagaries of markets.

The value of investments will fluctuate, which will cause prices to fall as well as rise and you may not get back the original amount you invested. Past performance is not a guide to future performance.

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