The new year has started relatively well for investors and although rising geopolitical tensions led to volatility, a quick reversal in Trump’s stance on Greenland has calmed markets. We remain optimistic about the economic outlook and are moderately positive about equities, where we prefer the US over Europe. On a sector level, we are taking some profit by reducing our position in the financial sector to neutral as we see momentum fading and possible regulatory pressures in the US. Meanwhile, we remain neutral on bonds. And finally, we are slightly reducing our overweight position in gold to take some profits following the recent gold rally. However, we remain positive about the precious metal as it provides us with diversification benefits and downside protection.
- Macro-economics: positive outlook despite geopolitical tensions
- Equities: further room to run
- Bonds: keep an eye on budget deficits
- Commodities: use gold rally to take some profits
