Posts Tagged "emerging markets"
Against a backdrop of worry over trade and rising interest rates, the United States economy continues to perform well. While equity markets generally declined in 2018, investors in the United States generally fared better than overseas. Moreover, most companies saw revenue, profits, and dividends grow in 2018, and we expect more to come in 2019. This annual Viewpoint, along with quarterly updates, provides an organized way of looking at the economy, financial markets, and your portfolio. The full report is available by clicking the link below.
We see higher long-run returns from emerging markets after a five year period of sideways performance and as returns in recent years push the Morgan Stanley Capital International (MSCI) EM Index well below the long-run trend (chart below). We are currently expecting long-run EM equity returns to be about 1% higher than our current long-run domestic equity return, now that the emerging markets have suffered through five years of sideways market action and underperformance versus developed equity markets. The multi-year slog for emerging market investors means that major EM indices remain near the levels seen during the 2008-2009 recession, despite…
Energy price declines should provide a benefit to global growth and lower inflation. Real growth could be materially boosted by lowered energy and gas prices by as much as $100 billion in the United States alone, as the lower price acts as a positive shock to consumption. On the flip side, we recognize that the impulse for lower prices emanated from weaker demand from emerging markets. Should the Federal Reserve (Fed) proceed with a midyear rate hike, one less prop for commodity prices will be removed. It is hard to interpret exactly how much of this is already priced in…
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