4th Quarter 2017
Market Outlooks & Reviews

PGIM’s investment managers provide diverse outlooks for the current global economic landscape from the perspective of their own portfolio managers and asset classes. Read the 4th quarter outlooks and reviews to find the investment trends and projections to look for as a result of global expansion, developments in the US monetary policy, and the growth in emerging markets.

The global economy is firing on essentially all cylinders.

4th Quarter Outlook

While overall growth rates remain somewhat below those recorded before the financial crisis, the expansion has become increasingly balanced across regions, with the United States, the Euro area, Japan, and China all growing in tandem at above-potential rates. Although the ongoing recovery has been characterized as “lackluster” and “the new mediocre,” perhaps these very features will allow it to live longer. The more restrained pace of growth through this cycle, while disappointing when taken by itself, may have limited the scope for imbalances to emerge.

QMA

Q4 2017 Outlook & Review

How much longer can the US expansion last? At 96 months, the current recovery is already one of the longest on record. Another year and a half and it will eclipse the mark set by the bellwether expansion of the 1990s. Still, based on the indicators we monitor most closely for recession risk, QMA now considers the odds of a downturn before the end of 2018 to be low.

As QMA’s Q4 2017 Outlook & Review discusses, this “To Be Continued” theme is part of the reason the Dynamic Asset Allocation team has a moderate overweight in stocks and other risky assets. The team has recently added exposure to value, financial and small-cap stocks, which it views as due for a catch-up in relative performance, particularly now that tax reform is back on the front burner.

The new Recession Dashboard: Still Blinking Green provides investors with a brief look at some of the high-frequency indicators QMA monitors closely to help gauge the risk of recession.
 
Stock Markets Remain in Uptrend with Strong Q3 Earnings, Solid Growth Momentum & Fresh Hopes for U.S. Tax Cuts

Global Investment Outlook & Strategy

John Praveen, Chief Investment Strategist of PGIM Global Partners, and his team undertake financial market and macroeconomic research and analysis to generate outlooks and forecasts, and formulate investment strategy within asset classes (stocks, bonds cash), within regional stock and bond markets, and global sectors.