経済

China’s oil demand growth will moderate to a still robust 4%-6% in the next six-to-nine months. We recommend that investors in China’s onshore and offshore stock indexes overweight energy producers.

Bulls and bears have capitulated, and the majority of the clients surveyed expect a rangebound market in the near term. Our fair value PE NTM indicates that the S&P 500 is only modestly overvalued. The continued outperformance of the Magnificent Seven faces multiple hurdles. Meanwhile, fiscal spending is unlikely to create an impetus for another leg up in equity performance.

US fiscal, monetary, and foreign policies are unlikely to deliver any dovish surprises for investors in Q4, due to the impending government shutdown, persistent inflation, and instability among OPEC+ and China.

Emergency pandemic fiscal and monetary policy measures buffered households and nonfinancial corporate businesses in ways that have acted to lengthen the lags between monetary policy changes and their effect on the economy. We believe, however, the extended lags are merely delaying the recession, not cancelling it. We expect to downgrade equities on a tactical basis from equal weight to underweight soon.