Investment insights: cuts, yields and opportunities
By Kirsten Hastings, 3 May 16
With the looming threat of dividend cuts and a reversal in bond yields, coupled with the emergence of new growth patterns and value opportunities, click through the following pages to read what five wealth managers think we should be paying attention to.
Patrick Armstrong, chief investment officer at Plurimi Wealth, says: “Risk assets have recovered significantly from mid-February lows. Signs of economic stability in China and the US have eased angst in markets in recent weeks.
“We believe a Chinese hard landing scenario is very unlikely at this point, given the recovery in manufacturing and the continued pro-growth monetary and now fiscal policies being employed by the Chinese central bank and government.
“We believe investors should position their portfolios into cyclical assets which have been hit hard by exaggerated recessionary fears.
“Following a weak start to the year, European industrial companies represent very good value and now provide an attractive dividend yield.
“However, we would recommend investors stay away from commodity-related equities, which have had a very strong start to the year.
“Over-supply in energy and metals will remain an issue for these companies, and although we are not worried about an imminent collapse from China, we believe the rebalancing of its economy is leading to much less reliance on commodities for infrastructure and manufacturing, and future growth is now more focused on services.”
Tags: Canaccord Genuity Wealth Management | Cazenove | Henderson Rowe
