Blackstone CEO Talks Fiscal Risk
Blackstone CEO Stephen Schwarzman believes that the resilient labor market, which has refused to cool despite the Federal Reserve’s tightening cycle, will keep the U.S. Economy on track. Speaking with Bloomberg from the International Private Equity Market Conference in Paris, Schwarzman says that the budget deficit is a bigger risk than the current business cycle.
Kyle Bass Talks Office Demise
Hedge fund manager Kyle Bass foresees a 10% hit to U.S. banking equity due to the post-COVID trend away from office space. Speaking with Bloomberg Markets, Bass predicted a $200 to $250 billion dollar loss from the office sector of commercial real estate. He highlighted industrials, multi-family and data centers as pockets of opportunity moving forward.
Mirae: Rate Cuts Are a Second-Half 2024 Story
Investors need to temper their expectations for rate cuts according to Rahul Chadha, Chief Investment Officer of Mirae Asset Global Investments. Speaking on Bloomberg Markets earlier today, he pointed to labor strikes around the world and sticky wages as headwinds for Central Bankers in the near to medium term.
Jefferies: China Headlines Worse Than Reality
Reports of China's economic downturn have been exaggerated in the West according to Jefferies Global Head of Equity Strategy Chris Wood, who sees a short-term buying opportunity as investors take flight. Speaking from the Jefferies Asia Forum, Wood doubled down on India, which he called his favorite Asian market for the past two decades.
iCapital: Pullbacks Could Entice Investors Looking to Get Back into Markets
iCapital Chief Investment Strategist Anastasia Amoroso thinks the economy is still showing a lot of strength, so she doesn’t expect to see a severe correction or recession this year. However, she says pullbacks are probable and could be enticing for investors looking to get back into the markets.
Morgan Stanley: U.S. Economy Cooling Off, Not Cold
Morgan Stanley Chief Global Economist Seth Carpenter says that a soft landing remains the most likely outcome for the U.S. economy. Speaking with Tom Keene on Bloomberg Surveillance, Carpenter added that while more drag from monetary policy is likely to slow the market in the months ahead, recession is still not the base case scenario.
Fidelity: China Stocks Remain ‘Top Call’
As forecasters slash growth estimates for China amidst weakness in the property sector, many investors have turned bearish on the world’s second-largest economy. But according to Fidelity International Director Catherine Yeung, they may be missing one of the most attractive buying opportunities in years. Speaking on Bloomberg Daybreak: Asia, Yeung made the case for Chinese equities, arguing that from a valuations perspective, the bad news appears to have already been priced in.
JPM: First-Half Performance Too Good to Be True?
Despite interest rate hikes across global Central Banks, equities markets have defied conventional wisdom and rallied throughout the tightening cycle. But according to JP Morgan Asset Management’s Karen Ward, perhaps this scenario has been too good to be true. Speaking on Bloomberg’s The Pulse, Ward expressed an expectation that tougher times are ahead–including the recession that could finally put a cap on inflation.
BlackRock: Front End of Curve is ‘Yield of Dreams’
While some pockets of fixed income could be a swing and a miss, BlackRock’s head of iShares Gargi Chauduri is calling the front end of the curve the ‘yield of dreams.’ Speaking with Bloomberg’s Jonathan Farro, Chauduri discussed the opportunity set for investors who can stomach the short-term volatility ahead.
Apollo: Non-Economic Factors Driving Bond Market
The U.S. 10-year real yield recently hit 2%, its highest since 2009. Despite a long-term economic outlook that has remained relatively stable, Apollo Partner and Chief Economist Torsten Sløk believes that non-economic variables may be driving outsized moves in the bond market, including the recent Fitch downgrade of U.S. government debt.
State Street Positive on Emerging Market Debt
Last year, 90%+ central banks raised rates globally against inflation. State Street's Ben Luk sees potential in disinflationary markets like Latin America, particularly in attractive local currency sovereign debt, discussed on Bloomberg Daybreak: Asia.
Blackstone: Energy Transition Is a $100 Trillion Opportunity
Last week, Blackstone closed its record energy transition private credit fund, B GREEN 3, at its hard cap of seven point one billion dollars – the largest fund of its kind ever raised. Joining Bloomberg Markets, Blackstone Credit Global Head of Sustainable Resources Rob Horn outlines several opportunities the firm is pursuing–including consumer solar and infrastructure.
Guggenheim: Investors Are Fighting the Fed
As recession talks have been replaced with a soft landing narrative, are market participants getting too comfortable? Guggenheim Partners Investment Management CIO Anne Walsh warns that credit may be the next shoe to drop, encouraging investors to remain cautious despite the headline resilience of the U.S. economy.
Invesco Keeps an Eye on Infrastructure
Invesco Global Market Strategist for Asia Pacific David Chao described equity valuations for the US as frothy, citing current market conditions as the calm before the storm. In an interview with Bloomberg Markets: China Open, he discussed his bullish position on global infrastructure, which he believes will benefit from persistent inflationary pressure.
Deutsche: We Are Overdue for a Pullback
Bolstered by strong balance sheets and the U.S. consumer, equity markets have outlasted repeated calls for a correction–but how long can it last? Deutsche Bank Chief Global Strategist Binky Chadha says that markets are overdue for a pullback, projecting a three to five percent decline in the near term.
Eastspring: Global Stocks Are ‘Bucking the Trend’
While rising yields normally spell bad news for stocks, equities markets around the world have been defying conventional wisdom. Speaking on Bloomberg Markets: Asia, Eastspring Investments Asian Equities Portfolio Specialist Ken Wong highlighted strong performances across North America and Asia to date, but is watching earnings season closely for what is to come in the second half of the year.