Global Equity portfolio outlook, positioning, and attribution as of 6/30/2019
June 30, 2019
- The U.S. economic expansion continues. Despite slowing growth and early signs of economic impact from international trade tensions, we still view moderate growth as likely in the near-term.
- The U.S. consumer remains a source of relative strength that should support continued expansion.
- European growth has suffered this year as the German economy has weakened due to softer manufacturing production.
- The Japanese consumer is healthy, but manufacturing activity has suffered with weaker Asian growth.
- We believe the maturing economic cycle warrants exposure to U.S. equity sectors with a mix of cyclical and secular drivers, such as Info. Tech. and Comm. Services, as well as less economically-sensitive sectors, like Consumer Staples, Health Care, and Utilities.
- We eliminated U.S. Financials exposure in light of slowing economic growth and the evolving interest rate environment.
- An underweight of international equities reflects the relative attractiveness of the U.S. economy and our favored U.S. exposures as international economic growth continues to struggle against headwinds from structural challenges, cyclical patterns, and global trade tensions.
- U.S. Information Technology
- U.S. Communication Services
- U.S. Energy
- U.S. Health Care
- U.S. Financials
- Western Europe