Welcome to Al Mal Capital Q3 2019 Global Market Outlook.

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.

Indeed, late-cycle expansions are often associated with elevated equity valuations, tight credit spreads, and financial excesses. While these conditions can create vulnerability, history also demonstrates that late-cycle equity returns can be very decent – albeit volatile.

In our view, the second half of 2019 is unfolding much like a funambulist walking a tightrope. The path for risk assets to move higher is becoming narrower with considerable risks attached to it. However, it remains manageable and best addressed through a diversified and selective portfolio management approach.
While our forecasts and views are subject to changes, our commitment to serve our clients is not.

We remain at your full disposal for any specific issues you like to discuss, so please do not hesitate to contact us.