The Outlook for Equities in 2019

Navigate late-cycle volatility with defensive equities

US equities are likely to outperform those in Europe and emerging markets in 2019, as investors face increased volatility amid rising interest rates and trade uncertainty.

Although global GDP growth is expected to slow in 2019, economic fundamentals may continue to support earnings growth in equity markets, most notably in the US.

Even so, equity investors are likely to face increased volatility amid rising interest rates and trade uncertainty, not to mention the multiple changes occurring to global equity indices in 2019. Given this backdrop, investors may wish to focus on defensive equities to navigate the late stages of this historically long cycle.

Key takeaways:

  • Go defensive with global diversification and overweight to the US
  • Political uncertainty warrants heightened caution in Europe
  • Emerging markets offer relatively attractive discounts to developed markets in technology and consumer stocks
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More on the 2019 Global Market Outlook

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