What’s been driving stock prices? Are they currently expensive or cheap? And which regions and sectors are poised to do well next?
These are some of the questions we aim to answer in our quarterly publication – the Schroders Equity Lens, a compilation of key trends in global equities illustrated through thought-provoking charts.
Click here for the latest edition of the Equity Lens.
Last year saw a reversal of many of the past decade’s trends:
- the US (-19%) was one of the worst performing markets, the UK was one of the best (+7% in GBP, -5% in USD)
- growth stocks heavily underperformed value (-28% vs -7% for MSCI ACWI Growth vs Value)
- within markets, the individual stocks that previously outperformed became the underperformers
Many stock market indices are concentrated by stock, style, or country. Achieving diversification is not as simple as might be thought.
There can be opportunities for those who don’t follow the indices.
Valuations have cheapened everywhere – the UK, Japan and emerging markets are cheapest vs history but the US has also re-rated a lot.
But expectations for slowing but still positive earnings growth in 2023, and then a reacceleration in 2024 may be optimistic
Chart of the month: