Snapshot - Insights
Kieron Launder: 2019 second quarter update
Low levels of inflation and low interest rates are supportive of higher valuations. They also suggest growth equities will continue to outperform.
Risk assets and safe havens both benefit from easier monetary policy
Equities, government bonds and gold all rallied during the second quarter. The key driver of the strong performance across asset classes was the prospect of interest rate cuts from the Federal Reserve.
Valuations not extreme given current inflation environment
While valuation multiples look high compared to the overall historical average, they are less so when compared to periods with similar levels of inflation.
Lower interest rates supportive of growth equities
High growth companies offer the prospect of big profits in the future. When interest rates are low and growth is scare – as is the case today - investors are more willing to back companies that promise jam tomorrow.
- Economics & strategy
- Investment team videos
- Quarterly Report
For Accredited Investors Only. This document is intended to be for information purposes only and it is not intended as promotional material in any respect. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument and is not intended to provide and should not be relied upon for accounting, legal or tax advice, or investment recommendations.
The information in this market outlook is derived from sources which we consider to be reliable. However, it may not in all cases be verified independently and we do not attest to its completeness or accuracy. No responsibility can be accepted for errors of fact or opinion. Forecasts may be the consensus of extremely divergent possibilities and the full range of potential outcomes should be appreciated. No representation or warranty is made that any value (or proximity to) any value, return or forecast will be achieved. The opinions expressed are those of employees of Schroder & Co. (Asia) Limited, and reflect their judgement at this date and are subject to change. Reliance should not be placed on the views and information in this market outlook when taking individual investment and/or strategic decisions.
No part of this document may be reproduced in any manner without the prior written permission of Schroder & Co. (Asia) Limited.