The stars are aligning for the Fed to start tapering bond purchases this year, though tapering and rate hikes have historically not stood in the way of equity market gains till monetary policy becomes outright tight. We continue to favour US and Euro area equities.
In China, though, the focus remains on property sector stress. We continue to believe a broader crisis is unlikely, but a catalyst in the form of less uncertainty or policy easing may be needed to trigger a bottom in Asian High Yield (HY) bonds.
- Manish Jaradi, Senior Investment Strategist, Standard Chartered Bank
- Abhilash Narayan, Senior Investment Strategist, Standard Chartered Bank
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