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Tectonic Shifts
Create New
Opportunities
The global economy has experienced major shifts in the past few years, and investors will need to keep pace with ongoing change.
Economic indicators are distorted, and fixed income markets are vastly different. Equity markets have become highly concentrated but may offer new opportunities for investors willing to taking a broader view.
Attentive investors can find reasons for caution, but optimism heading into 2024.
Three themes for 2024
VIDEO
Summary with Investment Specialist Ritu Vohora
Key takeaways from our 2024 Global Market Outlook.
Tactical Allocation Views
As of 30 November 2023
Investment professionals from the T. Rowe Price Multi-Asset Division presents theirviews on the relative attractiveness of asset classes and subclasses over next 6 to 18 months.
Valuations are broadly neutral with pockets of opportunity. We expect earnings to remain resilient in the near term, but global growth remains uncertain due to lagged effects of tighter monetary policy.
Yield levels are attractive relative to recent history. However, increased supply and sticky inflation could be headwinds, particularly for longer-term bonds. Credit fundamentals remain supportive.
With many central banks on hold, cash provides liquidity and continues to offer relatively attractive yields. However, the trajectory of easing could drive yields lower in the back half of the year.
This material is provided for informational purposes only and is not intended to be investment advice or a recommendation to take any particular investment action.
Earnings growth expectations for 2024 approach double digits as U.S. economic activity has proven resilient thus far. Valuations are full. Higher rates will pressure companies with high interest expenses.
Valuations are attractive on a relative basis, but the growth outlook remains challenged for some major economies, particularly Europe and China. Lower rates could support more rate-sensitive economies.
Valuations and currencies are attractive. Monetary easing could support growth. Chinese equities reflect headwinds amid housing sector concerns, but other regions should benefit from rebounding exports.
The asset classes across the equity and fixed income markets shown are represented in our multi‑asset portfolios. Certain style and market capitalization asset classes are represented as pairwise decisions as part of our tactical asset allocation framework.
This material is provided for informational purposes only and is not intended to be investment advice or a recommendation to take any particular investment action. Information and opinions, including forward looking statements, are derived from proprietary and non‑proprietary sources deemed to be reliable but are not guaranteed as to accuracy.
Yields are broadly attractive. We favor core and shorter duration as long-term bonds could remain vulnerable to inflation and heavy new supply. Credit fundamentals remain supportive.
Global central banks appear to be near peak tightening as inflation shows signs of slowing. Yields look attractive on a USD‑hedged basis.
Longer‑term yields likely are near a peak but remain vulnerable to increased supply and sticky inflation. Treasuries should offer ballast to risk assets as correlations are expected to decline.
Break‑even yields reflect a continued deceleration in inflation. Signs of inflation reaccelerating could present a reentry point.
Attractive yields should provide a cushion if spreads widen. Credit fundamentals remain strong, and while default rates could rise, we do not expect them to exceed their historical averages.
The asset classes across the equity and fixed income markets shown are represented in our multi‑asset portfolios. Certain style and market capitalization asset classes are represented as pairwise decisions as part of our tactical asset allocation framework.
This material is provided for informational purposes only and is not intended to be investment advice or a recommendation to take any particular investment action. Information and opinions, including forward looking statements, are derived from proprietary and non‑proprietary sources deemed to be reliable but are not guaranteed as to accuracy.
WEBINAR
Watch the webinar
Our chief investment officers weigh in on the state of markets and the economy heading into 2024.
Thinking
Regional Outlooks
Key areas of focus for investors in markets around the world.
European Market Outlook
Europe must tread a fine line to avoid stagnation
Asia ex-Japan Market Outlook
Where we see opportunities in Asia ex-Japan equities
China Market Outlook
Time to revisit an unloved asset class
Japan Market Outlook
Economic momentum and growth supportive policies underpin Japan’s renaissance
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Each month, our Investment Committee prepare a report revealing the two market themes they are watching, their bull and bear views per region and their latest asset class over and underweights.It has been designed to aid you in your decision making and client conversations.
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