Amundi’s Global Markets Overview

The research team at Amundi Asset Management (France) has published their perspective on the markets for the month of March. As an overview of emerging markets as a whole, the team states that emerging markets are performing poorly due to liquidity outflows, especially those with current account imbalances. On the positive side, the team says emerging markets are doing a better job choosing sound fundamentals over poor fundamentals of the past. They note that liquidity outflows are being re-allocated to developed market equities. 

The team at Amundi is optimistic about the current economic state of Europe. They state that while many expected a pause in growth due to multiple factors, there was none. While the team does not expect growth in European markets to be as strong as recent years, they still do expect growth in the future of about 3.5%. Capital inflows into European equities, the overall recovery of the global economy, and a new investor demand for equities should help spur the recovery. The team predicts 10% earnings growth this year, 2% below consensus predictions, but the team recommends patience for the market.

The same optimism carries over for Japan’s economic outlook. The team sees indicators of economic recovery due to the large-scale monetary easing due to personal consumption increasing, improving labor market, and growing corporate earnings. Amundi is concerned about the effects of the consumption tax hike but does acknowledge that Japanese authorities are prepared to adapt which may include further monetary easing.

In Asian markets, not including Japan, Amundi explains the transition the region is going through from government investment focused to domestic consumption and private enterprise focuses. The team goes on to include market liberalization as one of the largest reforms as well and the shift from quantity of growth to quality of growth.  The team expects slow growth in the short-term, creating a foundation for sustainable growth in the long-term.

From an investment view, the team at Amundi recommends looking for companies with sound long-term strategies due to Asian markets historically being more volatile than other markets. They still stress placing risk in places with most knowledge while maintaining sufficient diversification of risk and liquidity.

The research team at Amundi Asset Management includes:

Romain Boscher, Global Head of Equities

Eric Turjeman, Deputy Global Head of Equities

Nicholas Melhuish, Head of Global Equities

Futoshi Saito, Chief Investment Officer – Amundi Japan

Ayaz Ebrahim, Chief Investment Officer – Asia ex Japan


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