15 Mar 2022

Global Economic and Market Outlook 2022

In this report, we discuss the performance of financial markets and major economies in 2021 and the events/trends that impacted them.

We also share our outlook for global and GCC economies and the performance outlook for major asset classes in 2022 in light of changing politico-economic developments.

28 Feb 2022

Global Perspectives : Investment Trends and Risks -2022

In this report, we discuss the important trends that will impact the global economies and financial markets. It also appraises of key risks that investors need to navigate that will impact their investments.

21 Apr 2020

Perspectives March Publication

Welcome to the 34th edition of Perspectives.

In this publication, we highlight the 10 stories to remember from the “Corona Crash” which took place last month. We then share our global market outlook for the second quarter and beyond.
 
After reviewing the weight of evidence from a fundamental and technical standpoint, we explain why investors should stay cautious on risk assets following the strong rebound which has been taking place since March 23rd.
 

18 Mar 2020

Perspectives February Publication

Welcome to the 33nd edition of Perspectives.

Equity and credit markets have declined with unusual velocity. Investors hate uncertainty and they are currently facing 3 major unknows:

1) A Health crisis with no visibility on the length and extent of the pandemic;
2) Unprecedented economic damage: it is impossible to estimate what will be the short and long-term impacts of the global lock-down;
3) Financial contagion: Dysfunctional markets and wild swings suggest a liquidity crunch and forced sellers. This is all happening in an environment of high leverage and over-regulated banks.
 
The longer the pandemic lasts, the greater the risk that the sharp economic downturn morphs into a full-blown financial crisis with all bubbles bursting.

06 Feb 2020

Perspectives January Publication

Welcome to the 32nd edition of Perspectives.

2019 will be remembered as one of the best years ever for investors with every major asset class in the black. Despite an early backdrop of heightened volatility, escalating trade tensions, Brexit uncertainty, and calls for a recession, the year progressed in an unexpectedly pleasant fashion as the Fed used its limited arsenal to provide additional stimulus.

In this publication, we first review the market action in 2019, “the year of buying everything”. We discuss in detail what we identified as the 10 most relevant financial market stories in 2019.

06 Jan 2020

Perspectives December Publication

Happy New Year and welcome to the 31st edition of Perspectives.

2019 was an excellent year for Global Equities. Among the major markets, the US led with a stellar 29% return, while the MSCI Emerging market Index delivered 16%. Strong gains were recorded across the globe including in the UK, Germany, Australia and Japan. However, not all of these economies are in the best of shape. The bull run has been driven primarily by “dovish” monetary policy implemented by the major central banks.

Even though the MENA region lagged its peers, it still generated a decent 8.2%, the best return in the last six years. Brent Oil is closing the year at USD 68 a barrel, 27% higher than the beginning of the year. The Al Mal MENA Equity Fund performance for the period is slightly ahead of its benchmark.

25 Nov 2019

Perspectives November Publication

Welcome to the 30th edition of Perspectives.

22 Aug 2019

Perspectives August Publications

Welcome to the 28th edition of Perspectives.

The U.S equity large-cap S&P 500 Index and the technology-heavy Nasdaq Composite Index surged to record highs at the end of July buoyed by positive earnings reports and a dovish stance by the Federal
Reserve. But at the time of our writing, investors’ sentiment is turning more negative as U.S-China Trade war risk is coming back with a vengeance.

In this edition, we take a step back from international markets to focus on UAE prospects and Dubai in particular. While the DFM (Dubai Financial Markets) index has been lagging meaningfully the broader S&P Pan Arab index over the last 3 years, our 2019 bullish stance could well be vindicated. Indeed, as of the end of July, the main Dubai index has gained 15% year to date, outperforming other regional indices such as the Tadawul index and the ADX.

25 Jul 2019

Global Outlook Q3 2019

24 Jul 2019

Al MAL MENA Houseview for Q3 2019

Welcome to Al Mal Capital Q3 2019 MENA HOUSEVIEWS.

Middle East and North Africa equities posted decent returns in the first half of the year although they lagged U.S and Emerging markets equities. In the first section of this quarterly publication, we look at H1 & Q2 2019 in the rearview.

As mentioned in our 2019 outlook published in early January, we believe there are still some secular and cyclical reasons to be positive on MENA equity going forward. In a dedicated section, we share our main investment themes and stock convictions for the months to come.

The last section of this quarterly MENA equity outlook includes our macro and fundamental views on the main regions.
 

17 Jul 2019

Perspectives July Publication

Welcome to the 27th edition of Perspectives.

The first half of 2019 is one of the most memorable on record with strong returns across all asset classes.

Confronted by weaker economic data, risks to the trade outlook and still low inflation, central banks came to the rescue by opening the door to further monetary stimulus. Bad economic news became good news for financial markets as equities and credit rallied alongside traditional safe-haven assets such as government bonds and gold.

In the first part of this publication we review the 10 stories to remember from this eventful first half of the year. We then share our views for the third quarter and beyond – we believe that the path for risk assets is becoming narrower but maintain a positive stance on risk assets.

19 Jun 2019

Perspectives June Publication

Welcome to the 26th edition of Perspectives.
 
For much of this year, risk assets have enjoyed a healthy climb, helped by a dovish tilt from major central banks and hopes of a trade deal between the US and China. But as we entered May, volatility came back with a vengeance. Both global and Middle East equity markets gave up some of their year-to-date gains while bond yields continued to surprise on the low side.

In the first part of this publication, we try to assess what is currently priced by the market in terms of global recession risk. At the time of our writing, the U.S 10-year treasury yield is trading at 2.1% and the three-month to 10-year curve is slightly inverted, which seems to indicate that the market is priced for recession. We don’t buy the current bond market panic and explain why we believe investors should keep some exposure to risk assets.
 

22 May 2019

Perspectives May Publication

Welcome to the 25th edition of Perspectives.

After a strong first quarter, risk assets continued their rally in April on the back of accommodative central banks, the expectation of a recovery in Chinese growth and a solid start to the Q1 US earnings season. Equity markets climbed across the regions, while high yield spreads narrowed further. But at the time of our writing, volatility is making a come-back on renewed trade tensions. 

In this publication, we first discuss if the “everything” rally is coming to an end – in other words, should investors “sell the Trade war in May and go away”? Seasonality and other stock market cycles is the topic of the Behavioral Finance section. Based on the analysis of various cycle patterns, it seems that US equities might have further to go in 2019.
 

21 Apr 2019

Global Outlook Q2 2019

Welcome to Al Mal Capital Q2 2019 Global Market Outlook.

The first quarter of 2019 is one of the most memorable on record with strong returns across all asset classes. Earnings growth expectations have been revised downward quite sharply, macroeconomic numbers came out generally lower than forecasted and geopolitical risks remained high. 

But equity markets were able to climb the “wall of worry” as U.S stocks posted their best quarterly return since 2009. Indeed, the deteriorating fundamentals were offset by improving expectations for a trade deal with China and maybe most importantly global central banks moving back to a dovish stance.

21 Apr 2019

MENA Q2 Outlook 2019

Welcome to Al Mal Capital Q2 2019 MENA HOUSEVIEWS.

Middle East and North Africa equities posted decent returns in the first quarter although they lagged U.S and Emerging markets equities. In the first section of this quarterly publication, we look at Q1 in the rearview. 

As mentioned in our 2019 outlook published in early January, we believe there are still some secular and cyclical reasons to be positive on MENA equity going forward. In a dedicated section, we share our main investment themes and stock convictions for the months to come. 

The last section of this quarterly MENA equity outlook includes our macro and fundamental views on the main regions. 

17 Apr 2019

Perspectives April Publication

26 Mar 2019

Perspectives March Publication

Welcome to the 23rd edition of Perspectives.
 

19 Feb 2019

Perspectives February Publication

Welcome to the 22nd edition of Perspectives.
 
What difference can a month make! In December, risk assets tanked by the most since the global financial crisis in 2008. One month later, the S&P 500 had its strongest January showing since 1987. And all that happened in the midst of the longest U.S. government shutdown in history. Indeed, both developed and emerging market equities gained around 9% last month, boosted by signals from the US Federal Reserve (Fed) that it would be more patient with further rate rises.
 
In this publication, we first discuss whether or not investors should assume that the “Fed Put” is here to stay and how this could lead to a new era of lower volatility. We then step back from short-term market action by taking a “deep dive” into the Endowment investment approach, with a specific focus on the framework developed by David Swensen, the CIO of the Yale Endowment. We show that this highly successful strategy needs some adjustment when applied to small and mid-sized institutions such as Family Offices.

15 Jan 2019

Perspectives January Publication

Happy New Year and welcome to the 21st edition of Perspectives.

While 2017 was the year of the “Goldilocks economy”, 2018 has turned to be the year of trade conflicts, interest rate concerns and the rise of market volatility. As global equity markets peaked in January and went through a brutal cyclical bear market in the last quarter, the calendar effect is disastrous as 93% of the asset classes ended the year into negative territory. For most investors, 2018 was the worst year since the great financial crisis.

Our flagship fund “Al Mal MENA Equity Fund” ended the year in positive territory (+2.6%) and is up more than 20% over the last two years, more than any other asset class. This demonstrates that an unconstrained strategy focusing on alpha opportunities instead of the direction of the market can generate strong returns even in difficult global market conditions.

14 Jan 2019

MENA Q1 Outlook 2019

Please find enclosed our Q1 2019 House views for Middle East equities.

13 Jan 2019

Global Outlook Q1 19

Welcome to our quarterly outlook where we review the fourth quarter and the full year market action before sharing our thoughts for the months to come.
 
While 2017 was the year of the “Goldilocks economy”, 2018 has turned to be the year of trade conflicts, interest rate concerns and the rise of market volatility. As global equity markets peaked in January and went through a brutal cyclical bear market in the last quarter, the calendar effect is disastrous as 93% of asset classes ended the year into negative territory. For most investors, 2018 was the worst year since the great financial crisis.
 

21 Nov 2018

Perspectives November Publication

Welcome to the 20th edition of Perspectives. 

Global risk assets had a rough start to the fourth quarter, as widespread risk-off sentiment sent U.S. and international stocks sharply lower. Markets ignored strong economic data in the U.S., focusing instead on fears about the impact of rising interest rates, increased U.S.-China trade tensions, and future earnings uncertainty. This led to the S&P 500’s largest monthly decline in seven years. 

In the first article of this edition, we explain why we stay positive on risk assets even though we expect market corrections to be more likely and more frequent going forward. We then look at the policy and market impacts of the U.S mid-term election which produced a legislative gridlock, as widely anticipated by the markets. 

17 Oct 2018

Perspectives October Publication

Welcome to the 19th edition of Perspectives, where we review the third quarter of the year and share our thoughts for the months to come.

As highlighted in our Q2 outlook, “the world is bifurcating” and this happened to be the case again during the past quarter. Indeed, the U.S. economy and corporate America have been outperforming the rest of the world and the trend has been reinforcing during the third quarter. This macro-economic and fundamental performance divergence has translated into financial assets relative performance, with U.S risks assets clearly outperforming.

Performance divergence has not been occurring solely across international equity markets. Within U.S equities, “Growth” style has been outperforming “Value” style for seven quarters in a row. There are also large performance dichotomy within commodities, credit and even within our regional equity markets. 

10 Oct 2018

Global Outlook Q4 18

Welcome to our quarterly outlook, where we review the third quarter of the year and share our thoughts for the months to come.

As highlighted in our Q2 outlook, “the world is bifurcating” and this happened to be the case again during the past quarter. Indeed, the U.S. economy and corporate America have been outperforming the rest of the world and the trend has been reinforcing during the third quarter. This macro-economic and fundamental performance divergence has translated into financial assets relative performance, with U.S risks assets clearly outperforming.

Performance divergence has not been occurring solely across international equity markets. Within U.S equities, “Growth” style has been outperforming “Value” style for seven quarters in a row. There are also large performance dichotomy within commodities or credit. 
 

16 Sep 2018

Perspectives September Publication

Welcome to the 18th edition of Perspectives.

At first glance, the backdrop for financial markets and the global economy remains healthy. Despite the collapse of the Argentinian Peso and the Turkish Lira, escalating trade war and the upcoming US mid-term election, August was the calmest in 50 years for the S&P 500 but also a historical time for the index as the current US equities bull market officially became the longest ever. In a dedicated section, we first review the key factors behind this record run, the sectors which have been benefiting the most from it, the impacts on valuation metrics and why this rally has been the most hated of all time. We then take exception to the claim that this is the longest bull market in history by showing that this could be a much younger rally than the consensus thinks.
 

19 Jul 2018

Global Outlook Q3 18

Please find enclosed our Global Outlook Q3 2018

18 Jul 2018

MENA Q3 Outlook 2018

Please find enclosed our Q3 2018 House views for Middle East equities.
 

15 Jul 2018

Perspectives July Publication

Welcome to the 17th edition of Perspectives, where we review the second quarter of the year and share our thoughts for the months to come.

The first half of the year is already over! The list of geopolitical risks that have dominated the headlines throughout the second quarter kept expanding and included fears of trade wars, the U.S pulling out of the nuclear weapons agreement with Iran, relations between the U.S and North Korea and credit risk fears in Italy. When it comes to financial markets, the most important feature of the last 3 months has been the performance divergence between the U.S and the rest of the world. While the U.S equity and credit markets have been resilient, risk assets within Europe and Emerging Markets have been correcting. Much of the performance divergence can be attributed to bifurcating growth prospects and the strengthening of the dollar. Despite the rebound of the greenback, commodities have been doing surprisingly well and are now the best performing asset class since the start of the year. In the first part of this edition, we review in detail what we consider to be the “Ten stories to remember” from the first three months of the year.

14 Jun 2018

Perspectives June Publication

Welcome to the sixteenth edition of Perspectives.

As we progress towards the summer, global investors have to climb a new “wall of worry”: a populist government in Italy, European banks under pressure, a potential “domino” effect in Emerging markets (Argentina, Turkey, Brazil, etc.) and the Tariff debate. Meanwhile, the U.S stays unscathed as strong economic and earnings momentum continue to propel the Nasdaq index to new highs. In this publication, we review these recent developments and explain why they should not be treated in isolation. Indeed, we live in a world of financial interconnectedness; a European crisis will further strengthen the dollar, which itself will spur more stress in Emerging markets and so on. Both will affect investors’ sentiment and weigh on global credit spreads and equity valuations. As such, it is difficult to envisage even the U.S staying fully insulated.
 

14 May 2018

Perspectives May Publication

Welcome to the fifteenth edition of Perspectives.

To paraphrase a former hedge fund manager, there is always a bull market somewhere. So far, 2018 is no exception to this rule. While global equities and bonds are still in the red on a year-to-date basis, Middle East equity indices and global commodities markets have been roaring. In this publication, we use the concept of an investment clock as a way of relating the economic cycle to asset and sector allocation. Recent news flow and market action seem to indicate that the clock is ticking. This could imply an important rotation where previous underperformers start to become the new market leaders.

16 Apr 2018

Global Outlook Q2 18

Please find attached our Global Outlook for Q2 18.

Big US Tax cuts, threats of Trade War, fears of rising inflation, Fed rate hikes, strong earnings…It was indeed an eventful start of the year for investors. In the first part of this quarterly outlook, we review what we consider to be the 10 most relevant financial market stories of the first quarter.

15 Apr 2018

Perspectives April Publication

Welcome to the 14th edition of Perspectives, where we review the first quarter of the year and share our thoughts for the months to come.

Equity volatility returned with a vengeance in the first quarter of 2018. With twelve moves of plus or minus two percent in the S&P 500 year-to-date compared with a total of zero last year, it seems apparent that more than a few investors have become nervous since the broad index reached an all-time high on
January 26th. While there have been a variety of reasons for global equity investors to start to worry about the sustainability of the “Trump bull market” (increasing trade tensions, Facebook’s woes, the rise in LIBOR, etc.), the sentiment that valuation levels are exaggerated and the growth of passive investing
(with the resulting over-reliance on market-cap weighted indices) are also cited among the culprits behind the recent market correction. In the first part of this edition, we review in details what we consider to be the “Ten stories to remember” from the first three months of the year.

10 Apr 2018

MENA Q2 Outlook 2018

Please find enclosed our 2Q 2018 House views for Middle East equities.
 
In the first part of this report, we look at the first quarter in the rearview. While most developed equities markets and fixed income have been struggling recently, the first quarter of the year happened to be a very decent one for MENA equities as the S&P Pan Arab gained 7.2% over the period. Best performing markets were Egypt and Saudi.
 
Our flagship Al Mal Mena equities fund had one of its best quarter ever with a gain of +12.4% (net of fees and unlevered). In this report, we review in details the positive and negative contributors to relative performance. We also highlight that since the start of 2017, the fund is up +32.4% against +7.4%, i.e an alpha of 25% (with an ex-post tracking error or 6%).
 
In the second part of this report, we share our enthusiasm about the region as we continue to believe that the best is yet to come. Indeed, we see (at least) 5 reasons to be optimistic about MENA equities:

14 Mar 2018

Perspectives March Publication

Welcome to the 13th edition of Perspectives. 
 
After 18 months of extraordinary calm on the markets, volatility returned these past few weeks. The primary culprit has been an inflation fear. In the first section, we explain why the correlation between equities and bonds is flipping. This has important implications for portfolio construction as investors need to look for new diversifiers. In light of this, we look at Copper, as the red metal historically performed well in the context of rising inflation. Staying with commodities, we highlight why we believe US shale rise is overshadowing some of the strong factors that play in favor of Crude Oil.

20 Feb 2018

Perspectives February Publication

Welcome to the 12th edition of Perspectives. 

As mentioned in the January 2018 edition of Perspectives, we expect this year to be more volatile than 2017. While the  first month of the year was characterized by very strong momentum across asset classes and happened to be the best January since 1997, the start of February looks much more different.

In our markets review section, we look at the triggers for the come-back of volatility on  financial markets. We also share the opinion that this looks more like a correction than the start of a bear market.

18 Jan 2018

MENA Q1 Outlook 2018

At first glance, Middle East equities’ performance in 2017 was disappointing, especially when compared to emerging or even developed markets. The S&P Pan Arab Index returned a mediocre 2% gain last year compared to 34% for the MSCI Emerging Markets Index and 20% for the MSCI Global Equities Index. Not only did MENA equities underperformed the rest of the world, but the volatility was fairly higher than in the rest of the Emerging markets.

These poor risk-adjusted results can be explained by continued uncertainties regarding oil prices, a difficult agenda (Qatar blockage, GCC fragmentation, Lebanon, etc.), concerns over capital flight from Saudi and the fact that GCC GDP growth has been among the weakest in the World last year. With Saudi Arabia in recession and a soft UAE growth, the GCC weighted real GDP growth in 2017 might end up just around 0.5%, far away from the 3.5-4% projected growth for World GDP. There is no doubt that this lackluster growth rate had some impact on regional company earnings and equity multiples.

07 Jan 2018

Perspectives January Publication

Happy New Year and welcome to the eleventh edition of Perspectives.

By most measures, 2017 will be remembered as an extraordinary year for global risk assets as International equities recorded strong performance with record low volatility. The same cannot be said for our regional Middle East equities which ended a very volatile year with a slim gain.

Ironically, the performance of our flagship MENA equities fund (+19% after fees) is almost in line with the gross returns generated by the S&P 500 and the MSCI World. This demonstrates that an unconstrained strategy focusing on alpha opportunities instead of the direction of the reference benchmark can generate strong absolute returns even in “flattish” markets.

12 Dec 2017

Perspectives December Publication

Welcome to the tenth edition of Perspectives.

Following strong performances throughout much of 2017, the majority of global markets have consolidated over recent weeks. Importantly, near-term weakness is still playing out in the context of uptrends and a supportive global credit backdrop.

In this edition, we highlight two strong performers of 2017: Frontier Emerging markets and Bitcoin. Cryptocurrencies and the Blockchain have been hot topics throughout most of the year and with bitcoin reaching $15,000 at the time of our writing, we seize the opportunity to revisit the investment thesis as “institutionalization” of cryptocurrencies could become a strong theme in 2018. Frontier emerging markets is for sure closer to our core business - this month, we highlight the reasons of our long-term positive stance on this segment of the market.

09 Nov 2017

Perspectives November Publication

Welcome to the ninth edition of Perspectives.
 
Many investors were expecting some type of market correction in October, but the only thing that crashed last month was volatility. Despite being historically the most volatile month of the year and even as we commemorated the 30th anniver­sary of the Black Monday stock market crash, October 2017 happened to be the calmest on record for equities. Indeed, the CBOE Volatility Index recorded the lowest monthly average in its history, according to data compiled by Bloomberg. 

16 Oct 2017

MENA Q4 Outlook 2017

While we continue to see very interesting opportunities across markets in the Middle East, the region remains out of investors’ radar mainly due to the lack of visibility on oil prices and geopolitical concerns. We believe that interest from investors should pick up as the oil market stabilizes and as Saudi Arabia gets closer to inclusion into the MSCI/FTSE Emerging Market indices in the first half of 2018. Our flagship MENA Equity Fund continues to perform well with a year to date performance of +13.86% (as of the 4th of October), outperforming the benchmark by +10.03%.

Allowing women to drive in Saudi Arabia might sound trivial for many, but we do see it as an important milestone towards economic diversification. To our opinion, the Kingdom’s biggest asset is its human capital and having half of the population idled has hampered economic growth.

05 Oct 2017

Perspectives October Publication

Welcome to the eight edition of Perspectives.

Despite all the political noise and natural disasters, international markets continued their move in a favorable direction in the third quarter as investors cheered rising company earnings and improving global growth. As we discuss in this publication, the market outlook for the rest of the year seems pretty solid as the risks to economic and corporate profit growth seems rather low.

That being said, the current market context of low volatility is not supposed to last forever which means that a more dynamic asset allocation will be required at some point. In the “Portfolio Management section”, we look at the “3-way model”, a simple but highly effective trend following system which could potentially help asset allocators to identify regime change.

07 Sep 2017

Perspectives September Publication

Welcome to the seventh edition of Perspectives. 

Risk assets have been again defying gravity over the last few weeks as the period of higher volatility which usually characterizes the summer has not been observed this year – at least for now. At the time of our writing, the Nasdaq is close its 52 weeks high, many Emerging markets are breaking out and credit spreads are near their tightest level of the year. Other surprises for investors have been the strength of the euro, the 10-year Treasury bond yields hovering at pre-election levels and…bitcoin reaching $5,000. 

So what’s next? There are signs that the long-awaited correction could still happen. Indeed, triggers for a “risk-off” trade have been piling up recently. Among them: the North Korea missile launch over Japan, the U.S. debt ceiling & budget negotiations, the impacts of hurricane Harvey in Houston (4th largest city in the U.S.), the fading of optimistic sentiment in Europe, the worsening of Brexit negotiation, the roll-over of China’s PPI and toppish PMIs around the world.

13 Jul 2017

MENA Q3 Outlook 2017

MENA markets are still struggling to catch up with Emerging markets. MENA performance of +3.37% for the first half of 2017 came shy of the+18.43% for Emerging markets. Nonetheless, with Saudi Arabia’s addition to the MSCI emerging markets index watch list and a very strong chance of an upgrade next year, the region should start to attract more attention.

With the recent addition to MSCI watch list, momentum is expected to continue in Saudi as we head into the third quarter. The market should also get more support from increased government spending as we draw closer to year end (capital spending was budgeted 59% higher versus 2016). To a large extent the government is still the main driver of the local economy, and with more reforms coming into effect, their spending program should accelerate.

09 Jul 2017

Perspectives July & August Publication

Welcome to the sixth edition of Perspectives.

The first half of the year is ending and despite some shaky sessions at the end of June, global equities had their best first half of the last 19 years. Emerging markets were very strong but even the S&P 500 performed well with its best first 6 months’ performance since 2013. Another remarkable fact has been the “Goldilocks” nature of this rally as US equities, long duration US Treasuries and Gold all ended the period with gains between 8% and 9%. Par pure coincidence, our Middle East equities fund generated similar gains in the first half (+9.1% to be precise) despite challenging MENA equities markets. This shows that effective active management can make a difference in our region.
 

04 Jun 2017

Perspectives June Publication

Ramadan Kareem and welcome to the fifth edition of Perspectives.

Despite the extraordinary political environment in which we find ourselves, the vast majority of global equity markets are reaching new highs as investors begin to appreciate the rate of change improvement in the economy, and importantly, corporate earnings.

During this euphoria, some particular stories are catching the attention of the general public. The 20-year anniversary of Amazon IPO is one of them – this exceptional journey is our “Hot topic” of the month.
 

04 May 2017

Perspectives May Publication

Perspectives explore investment opportunities within international and MENA markets and across asset classes.

Volatility made a (timid) comeback in April and bond yields continued to surprise on the low side. Nevertheless, it was another solid month for international equity markets as the technology-heavy Nasdaq index crossed the 6,000 mark for the first time ever. Meanwhile, global investors’ focus is progressively shifting towards non-US international markets as Europe and selected Emerging Markets have been collecting impressive amounts of foreign flows recently. In the Middle East, markets have been range-bound but the major news was definitely the decree by King Salman of Saudi Arabia to rescind salary cuts and reinstate bonus payments to thousands of civil servants.

05 Apr 2017

Cross-assets Quarterly Outlook

Equity risk premium for the markets is still higher than long term average showing absence of bubble in the markets

Forward free cash flow yields on major markets are higher than long term average signaling strong cash generating strength of corporates

Emerging Markets are now trading at a wide discount to US equities

02 Apr 2017

MENA Q2 Outlook 2017

Perspectives explore investment opportunities within international and MENA markets and across asset classes.

The “Trump” rally which began on November 8th continued in February. After a brief pause at the start of the month, the vast majority of risk assets has resumed their uptrend. Unsurprisingly, most investors, including our clients and ourselves, are wondering if markets are now “priced for perfection”. This is the first topic of this second edition of Perspectives. While a pause might be due, we continue to believe that this bull market has further to go and that any pullback should be seen as a buying opportunity. Most favored assets remain those which should benefit from rising inflation (see the “Investment theme” section).
 

01 Apr 2017

Perspectives Monthly Publication - April Issue

Perspectives explore investment opportunities within international and MENA markets and across asset classes.
 
In this edition, we share our view that investors might have to look at opportunities outside US equities in the months to come. This is precisely the focus of our monthly investment strategy (“Looking beyond US equities”) and the “Macro round-up” (“Brexit is official!). The “Hot topic” of the month is about the ETF bubble, which creates both risks & opportunities for fund managers. We then make the case for investing into Floating Rate Loans, an attractive asset class in a rising rate environment.

01 Mar 2017

Perspectives Monthly Publication - March Issue

Perspectives explore investment opportunities within international and MENA markets and across asset classes.

The “Trump” rally which began on November 8th continued in February. After a brief pause at the start of the month, the vast majority of risk assets has resumed their uptrend. Unsurprisingly, most investors, including our clients and ourselves, are wondering if markets are now “priced for perfection”. This is the first topic of this second edition of Perspectives. While a pause might be due, we continue to believe that this bull market has further to go and that any pullback should be seen as a buying opportunity. Most favored assets remain those which should benefit from rising inflation (see the “Investment theme” section).
 

01 Feb 2017

Perspectives Monthly Publication - February Issue

Perspectives explore investment opportunities within international and MENA markets and across asset classes.

In this first edition, we attempt to answer the question if it is the time to call for a top in the U.S equity market. We also share our view on the rising rates story in Global Fixed Income and highlight which sectors are the most likely to benefit from this new paradigm.