Q4 2018 MARKET OUTLOOKS

The globally synchronized growth story of earlier this year is being supplanted by a decoupling caused by US strength and signs of weakness in other major economies. PGIM’s leading macroeconomists and investment experts provide a diverse set of outlooks on the factors that contributed to bouts of periodic volatility and the opportunities that lie ahead as 2019 approaches.

PGIM Fixed Income

4th Quarter Outlook

This edition of our quarterly outlook features the following:

  • In “Can You Make Money Standing Still?” Robert Tipp, CFA, Chief Investment Strategist and Head of Global Bonds, looks at conditions across several major asset classes. Given the current backdrop, Tipp indicates that maintaining a relative-value perspective may reveal opportunities from sector allocation, yield curve positioning as well as issuer and currency selection.  
  • “Global Growth: Less Synchronized, but Still Intact…”, by Nathan Sheets, Chief Economist and Head of Macroeconomic Research, and PGIM Fixed Income’s macroeconomics team, isolate two key factors—the persistent pressure across the emerging markets and the escalating trade war—that have contributed to the fraying of synchronized, global growth. The piece subsequently examines how these global issues might evolve as 2019 approaches.
  • In “When Giants Collide: The U.S.-China Trade War,” Sheets reviews the steps in the trade war thus far, the next potential moves that each side might take, and how each country’s economic growth could be affected.
Indicators of global growth have recently softened a touch, but they generally remain in solid, expansionary territory.
Our base case remains that the global economic expansion still has room to run.

QMA

Q4 Outlook & Review: Blue Skies Above, But Clouds on the Horizon

Can US stocks really continue to go it alone? In a word, yes, although QMA is watching for signs of a possible rotation.

PGIM Global Partners

Global Investment Outlook & Strategy

The Global Investment Outlook & Strategy is a monthly research publication. The document provides a comprehensive review and outlook for global financial markets and economic trends. The document also presents investment strategies and recommendations for asset allocation (between stocks, bonds, and cash), global equity markets within major developed and emerging stock markets and sectors and global bond strategy within major bond markets.

Market indicators look strong for now, but with the United States economy in its ninth straight year of expansion, investors are aware that the current cycle will not go on forever.