Infrastructure for the New Economy: Digitization and Sustainability
Margaret Franklin, President and CEO of the CFA Institute, moderates a discussion with Lisa Davis (PGIM Real Estate), Christina Kim (PGIM Private Capital), and Warren Koontz (Jennison Associates) around how investors can capitalize on the growing momentum behind rebuilding the nation’s infrastructure and the underappreciated investment opportunities that will come with it.
Outlooks Across Asset Classes
2Q 2021 Market Review and 3Q Outlook
Investors spent much of the first half attempting to bisect the equity landscape along themes of growth versus value and economic reopening versus remote work. However, stock price fluctuations over the past two quarters suggest this is a simplistic approach to forecasting the course of equity markets. Corporate profit growth and economic recovery have been constant factors throughout the year, despite changing expectations about their rates of improvement. We continue to focus on companies with secular growth opportunities that we expect will extend well beyond the pandemic. These durable opportunities have been a source of strong growth this year and are poised to offer improving rates of relative growth as the effects of fiscal and monetary stimulus diminish through the back half of 2021 and into 2022.
2021 Q3 OUTLOOK
Following last year’s historic collapse, the global economy is experiencing an exceptionally strong recovery but also an uneven one. While advanced economies are growing rapidly and are poised to recover pre-COVID-19 levels of economic activity this year emerging economies (excluding China) are lagging, and many of the world’s poorest economies are being left behind. The global economy is set to expand by 5.8 percent in 2021, according to the Organisation for Economic Co-operation and Development, and around 4.5% in 2022. Developed economies are expected to grow around 5.3% in 2021, led by a strong upturn in the United States and strong private spending in most countries. The growth pace is expected to moderate to 3.75% in 2022 as the impact of fiscal and monetary stimulus fades.
2021 Global Outlook
The worst of the crisis has passed, and 2021 is shaping up to be a significantly better year for the global economy and real estate markets as compared to 2020. PGIM Real Estate's annual Global Outlook, published in May 2021, illustrates why they are optimistic, and identifies the opportunities that are among the most attractive on a risk-adjusted basis over the next year.