January 4, 2023

Institutional Views: Deutsche Bank, BlackRock and Nomura

Jan 4, 2023

Individual investors are often bombarded with specific stock calls and targets.

However, we believe you can get a better medium to long term perspective by considering asset class, sector, thematic and macro economic views.

To help you, every week, we pour through the research produced by some of the larger institutions, and summarize their market thoughts.

We’re launching 2023 with the below 3 updates:

Deutsche Bank
Mild recession (85% likelihood) & weak 2023 recovery. US & Euro Inflation falling to 4% & 6%. Bullish bonds, specifically high-yield EM. Dec23 to see MSCI EM Index, Euro Stoxx50 & FTSE100 to price at 990, 4,000, & 7,650. Geopolitical risk & high CB buying to benefit precious metals. Brent Crude Oil to reach USD100 Dec23. USD to weaken.

US recession and above 2% inflation foretold in 2023. Underweight DM equities, which are failing to price in Recession and wrong to expect Fed rescue or rate cuts. Euro’s CBs fail to identify recession magnitude required to curb inflation. Overweight investment grade credit on attractive valuations. Like inflation-linked bonds. Underweight long-term Government bonds. Low carbon sectors or companies with clear transition appeal. 

US rate hikes to terminate in Mar 23 at 5%. 25bp and 50bp cuts to start Sep 23 and Q2 24 respectively. Deeper Asia export downturn expected in H1 23. Despite China’s ZC-Strategy reverse, near-term growth forecast to worsen (below market consensus). Optimistic for Asia H2 23 with large capital inflows owing to better relative growth prospects, strong fundamentals and China reopening rebound. 2023 recession unavoidable for Europe (GDP: -2.5%) and UK (GDP: -2%).

* Please note these are not the thoughts or analysis of illio but the respective institutions. We have summarized what we believe are key points. We assumes no responsibility or liability for any errors or omissions in the content of this site. The information contained herein is not intended to be a source of advice and the information contained in this website does not constitute investment advice.

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