10 Sep 2019 07:30

Investment Outlook: Uncertain outlook justifies caution

Having noted signs of weakness in global growth – combined with the US-Chinese trade war and an especially murky near-term risk situation as an autumn of Brexit approaches – in August we underweighted equities in our portfolios for the first time since 2016. Aside from this risk picture, financial market performance since the beginning of 2019 has also been very strong, leading to our assessment that a decrease in risk exposure was appropriate.

“We are in the late phase of the economic cycle. Combined with the ongoing trade war, we are receiving signals that make us sceptical of the growth rate and earnings-generating ability of the corporate sector. But offsetting this are renewed actions by central banks and political leaders, as well as an already significant risk aversion among investors. The decision about how defensive one wants to be is a delicate balance between short-term worries, amid high market volatility, and more long-term considerations – such as the unusually large difference between the level of dividends in stock markets and the yields in bond markets,” says  Fredrik Öberg, Chief Investment Officer, Private Banking.

The September issue of our Investment Outlook report includes two theme articles covering different aspects of sustainability – a topic that was once the province of dedicated eco-activists but has become a word, a debate and a set of issues that no one can avoid. We examine “impact investing” and how you can do good while making money. In a second, longer theme article we analyse various energy storage solutions and the potential enhancements they represent for sustainable energy sources like wind and solar power.

Investment Outlook can be read in its entirety or as a 2-page summary at:

seb.se/investmentoutlook

For further information, please contact
Fredrik Öberg, Chief Investment Officer
+46 8 763 6304
fredrik.oberg@seb.se
Press contact
Laurence Westerlund, Pressansvarig
+46 8 763 8627
laurence.westerlund@seb.se
 
SEB is a leading Nordic financial services group with a strong belief that entrepreneurial minds and innovative companies are key in creating a better world. SEB takes a long-term perspective and supports its customers in good times and bad. In Sweden and the Baltic countries, SEB offers financial advice and a wide range of financial services. In Denmark, Finland, Norway, Germany and UK the bank's operations have a strong focus on corporate and investment banking based on a full-service offering to corporate and institutional clients. The international nature of SEB's business is reflected in its presence in some 20 countries worldwide. At 30 June 2019, the Group's total assets amounted to SEK 2,912bn while its assets under management totalled SEK 1,932bn. The Group has around 15,000 employees. Read more about SEB at http://www.sebgroup.com.

 

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