Global Markets Outlook 2019 - Part III

A Buffet of Outlooks for the Upcoming Year

Picture this - you're at a Chinese buffet.  You've already had two sizeable helpings, but the proprietors of the establishment have just brought out another tray of your favorite dish.  Maybe it's their Kung Po Chicken, or their Cantonese Pork, or those fresh Crispy Duck Pancakes with the hoisin sauce.  The point is - it's your favorite...

Well, it's time to rise to the occasion, grab your plates, and get back in line, because we went ahead and dished up our third portion of 2019 Outlook papers below.  There's some really meaty content here, including WEF's global risks report, Moody's extensive economic webinar, and S&P's detailed industry-specific outlook compilation.  Bon appetit!

Investment Outlook 2019: Regime Change (BNP Paribas AM, Dec 2018)

Trade tensions, quantitative tightening, and higher interest rates may sprout additional volatility in 2019, but more importantly, a regime change is on the cards. The end of both the decade-long equity bull market and the 30-year bond market rally could unwind correlations in asset classes.

Cash was king in 2018, but likely won't be in 2019 (Eaton Vance, Jan 2019)

For compliance reasons, this paper is only accessible in the United States and Canada

2018 was a year in which “cash was king.” U.S. 3-month Treasuries returned just under 2% in 2018, while long-duration and other fixed income classes were either flat or down for the year.

CIO Investment Outlook: Brace for a credit squeeze (LGIM, Jan 2019)

For compliance reasons, this paper is NOT accessible in the United States and Canada

LGIM’s bearish outlook for 2018 came to fruition. But how will tighter financial conditions impact borrowers in 2019, and does this increase the risk of a recession?

Industry Top Trends 2019 (S&P Global Ratings)

At 322 pages, this document is an amalgamation of 23 different industry outlooks for 2019, all produced by S&P Global Ratings.

HSBC Global Asset Management 2019 Outlook - Back To Reality

For compliance reasons, this paper is only accessible in certain geographies

After the Goldilocks environment investors experienced in 2017, 2018 was both a disappointment and a wake-up call. The authors review economic and market activity over the past year and ask of 2019: 'how might economic events evolve relative to what is discounted now?'

Long-term perspective on markets and economies (Capital Group, Jan 2019)

For compliance reasons, this paper is only accessible in certain geographies

Given rising volatility, tighter monetary policy, trade wars, and the late cycle of the current economic expansion in major economies, the uncertainty present in early 2019 is palpable. How should investors position accordingly?

Capital Markets Outlook: 1Q 2019 (AB)

For compliance reasons, this paper is only accessible in North America and South America

Despite a rocky Q4, a recession may not be imminent. AB projects solid growth for 2019, albeit lower than growth in 2018, while keeping watch for signs of deteriorating economic fundamentals.

Asset Allocation Committee Outlook 1Q2019 (Neuberger Berman)

For compliance reasons, this paper is only accessible in certain geographies

Expectations for 2019 are for continued downsizing of central bank balance sheets and a restoration of global growth to sustainable levels. The authors see attractive valuations in emerging markets and high yield credit, whilst being mindful of geopolitical risks.

Webinar: 2019 U.S. Macro Outlook - From Virtuous to Vicious Cycle (Moody's)

In this webinar, Moody's Chief Economist Mark Zandi shares his global economic outlook, including why 2019 should be another fairly good year, the threats to this expectation, and why a downturn early in the next decade is more likely.

Top Risks 2019: Bad Seeds (Eurasia Group)

This 27-page report by Eurasia Group explores the top geopolitical risks facing the world in 2019, and their potential effects on the global economy.

The Global Risks Report 2019 (World Economic Forum)

At 114 pages, this WEF report covers a host of geopolitical and economic risks on the horizon for the upcoming year. 

Shifting Sands: 2019 Market Outlook (BNY Mellon IM)

Trade wars, inflation, and euro debt are potential headwinds for the global economy in 2019, but that doesn’t necessarily mean the overall global picture is a negative one.

Outlook 2019: More Risk for Less Return? (Cambridge Associates)

Does late-2018 volatility constitute an intermission in the ongoing bull market or a turning point? Strategists at Cambridge Associates lean towards the former, however, the second act may be much shorter than the first.

Outlook for 2019: The Game Has Changed (KKR)

Despite weaker economic growth expectations, KKR remains positive in their macro positioning for early 2019. Many asset classes currently appear attractive, but this does not constitute a return to business as usual. In fact, a different approach to asset allocation in 2019 may be required.

2019 Global Economic Prospects: Darkening Skies (World Bank)

This report by the World Bank describes global economic prospects for the coming year. Global growth is expected to slow to 2.9 percent, while international trade and investment are falling, trade tensions are high, and financing conditions are tightening.