Here at Reeves Independent we are currently working on our new client Investment Portfolios. Below are a number of key points from experts concerning the next few months investment outlook!!
UK & Europe
- European Central Bank keeps interest rates at 0.25% & raises its forecast for growth to 1.2% in 2014 & downgraded its inflation estimate to 1%
- UK interest rates have been held 0.5% for another month to continue to stimulate the UK economy
- Bank of England upgraded its expectation of growth this year to 3.4% – if this turns out to be correct it will be the biggest growth since 2007
- The recovery in UK commercial property values gathered pace in the second half of 2013 and this momentum is expected to continue through 2014
- Russia/Ukraine crisis will be mean investors should be prepared for further volatility, in the region & across emerging markets. They should be mindful of potential infection for some European banks & other companies with significant business interests in Russia and/or Ukraine
- Supportive structural measures by Eurozone governments, combined with the successful efforts by companies themselves to become cost-effective are providing positive signals. Global growth & increased consumption in Asia should benefit European countries (Global equities)
- US Growth puzzle falling into place – growing household wealth thanks to rising home & share prices, along with gradually improving labour market, signals higher US consumption ahead
Asia & Emerging Markets
- Uncertainty about Japan will increase due to tightened fiscal policies & increased taxes
- China, growth will decelerate cautiously this year, mainly due to reform efforts including a tightening of credit expansion
- India’s economic slowdown appears to have bottomed out, but there are no signs of vigorous recovery
- Faster growth ahead in emerging Asia due to exports to the US & Europe & increased intraregional trade (Singapore/Taiwan are expected to benefit the most)
- Emerging markets are working to resolve the problems caused by high inflation, large current account deficits & political instability
- Economic trouble spots in Latin America – Brazil/Argentina especially – not help by political unrest in Venezuela
- Quantative Easing talk has fallen into the background over recent months but we must be wary until a firm decision has been made
- International economic upturn appears increasingly stable
- Looking ahead, companies in the commodity, engineering & IT sectors are showing the highest earnings growth in 2014
- The world economy is accelerating – expected global GDP growth is estimated at nearly 4% for the next 2 years.
- Emerging markets is estimated to grow even quicker at 5% annually for the same period
- Positive global manufacturing data predicts continued growth in this sector
So what does this mean for our Investors & Portfolios?
- Reduced cash holdings due to increased confidence
- Opportunities available in India & emerging Asia
- Possible switch of focus to US funds
- Invest in funds that traditionally do well in economic growth periods such as Special Situations, Finance, Small Caps
- Continue to invest in specialist property related funds & technology funds
- Potential to be brave in markets that are struggling such as Russia
If you would like to discuss your portfolio please contact us now on 0191 281 9862 or e-mail firstname.lastname@example.org to arrange an appointment!
Disclaimer: This email is not intended as advice and no investment decisions should be made solely on the back of this email. Past performance is no guide to the future. All investments carry the risk that you will not get back what you have put in.