2024 MIDYEAR OUTLOOK
Economic outlook: U.S. powers global growth
Despite stubborn inflation and high interest rates, the U.S. economy is expected to expand this year at more than twice the rate of other major economies. What's more, American consumers are helping to support growth in the rest of the world. Here’s what to watch for in the months and years to come.
“People used to say if the U.S. sneezes, the rest of the world catches a cold. But the opposite is also true. When it’s firing on all cylinders, the U.S. can help other export-oriented economies.”
Darrell Spence, Economist
EQUITY OPPORTUNITIES
Stock market outlook: 3 themes for a broadening market
No rally lasts forever, but at midyear, equities across a broad range of markets and industries appear poised for accelerated earnings growth. Members of our investment team identify the tailwinds behind this and share three catalysts for potential long-term growth.
Sources: Capital Group, FactSet, Morningstar. Magnificent Seven stocks were the top seven contributors to returns for 2023 in the S&P 500 Index. The Magnificent Seven non-U.S. are the top seven contributors to returns for 2023 in the MSCI EAFE Index. Cumulative returns are indexed to 100 on January 1, 2022, and shown through May 31, 2024, and are calculated on an equal-weighted basis for the seven stocks within each group. Past results are not predictive of results in future periods. Returns are in USD.
FIXED INCOME OPPORTUNITIES
Bond outlook: Opportunities emerge as Fed delays rate cuts
Markets have slashed expectations for rate cuts to align to the U.S. Federal Reserve's forecast of one cut by year end, but bonds still offer a sweet spot between high income and protection from equity market swings.
“Bond investors were too exuberant about rate cuts at the start of the year, but now that markets aren’t aggressively priced for cuts, valuations for fixed income are more attractive.”
Vince Gonzales, Fixed Income Portfolio Manager
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*Source: Marketing Support: The Advisor View, May 2023, July 2021, June 2020; Fund Intelligence, February 2020. FUSE Research surveys of 500-1,000 U.S. advisors identifying the “most-read thought leaders.” Survey was not conducted in 2022.
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