Multi-asset market outlook

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• Multi-Asset Solutions Weekly Strategy Report
• Bonds and equities send divergent signals.
• Spring fever

• Those who hoped for a December equity market rally were massively disappointed. Not only did the markets take a hit in the first days of the month, but losses rapidly accumulated going into the new year. The gains realized by equity markets in the first three quarters had already been erased before December had even begun. Global equity markets ended 2018 with 7.4% loss.
• While only a couple of months ago we were talking about a possible overheating, fear prevailed towards the end of the year. Confidence was eroded by a number of issues. The US economy started to show signs of weakness, while the trade war with China and the weakening Chinese economy began to weigh on US corporates profits. The market also started to lose hope that tariffs would either be lifted or frozen, and the Fed refrained from making changes to its pre-determined hiking path. Amid all the headwinds, emerging markets outperformed developed markets in the last quarter.