The Big Picture, Don't Follow the Herd
How to navigate between stretched equity valuations, rising bond yields, political gridlock, higher volatility regime and growing trade tensions? One of the answers lies in being very selective in terms of sectors and geographies as political uncertainties and central bank decisions will have substantial impact on the markets for the month to come.
Societe Generale equity strategists have not shared the strong bullish view of the consensus on US equities since the beginning of the year. They remain cautious due to rising rates, political uncertainties (trades and mid-term elections in November) and a lack of supportive new catalysts. Not mentioning that the US economic cycle is entering its last leg.
In the Euro area, fundamentals remain supportive for the macro outlook after a weak 1Q. However, the less accommodative monetary policy from the ECB would potentially impact several assets (bonds, credit and currency) and some European sectors in equity markets. Hence, SG strategists recommend being very selective when investing in Europe and highlight sectors and stocks that would potentially benefit more from this context.
“The Big Picture” is Societe Generale’s Equity Strategy quarterly flagship research product which sets out key investment recommendations on sectors and thematic baskets prepared by our top ranked equity sector analysts, equity strategists, and global macro teams. See below links for details on how to access the Q3 report - The Big Picture, Don't Follow the Herd - on SG Markets Research and Insights.
SG Cross-Asset Research is composed of more than 200 Analysts, Strategists, Economists and Quant, combining their expertise into ‘Research-based’ and innovative solutions suited to client’ needs: fundamental studies and expert views, investment ideas and long-term strategies, trade ideas and tactical baskets, thematic and systematic indices, quant solutions. On top of its established UK and Western European base, SG Cross-Asset Research benefits from a global coverage thanks to its presence in the US and in Asia (Hong Kong, Singapore, Tokyo and Bangalore) and Societe Generale local networks in Eastern Europe.