Horizon Handout February 2021

Capital Market Outlook of Berenberg Wealth & Asset Management - compact outlook on capital markets, economy, equities, bonds, economics and currencies.


  • Recovery interrupted by second wave of infection. Smaller setback than in spring last year.
  • Governments and central banks continue to support the economic comeback with all means at their disposal.
  • Monetary and fiscal policy support and vaccines argue for a strong recovery from spring onwards.


  • Equities performed well at the start of the year, with emerging market equities in particular gaining ground.
  • Analysts have raised earnings estimates across almost all regions, and valuations have fallen as a result.
  • We prefer European and emerging market equities in particular throughout 2021.


  • Rising inflation expectations are likely to push yields up further. Safe government bonds remain unattractive.
  • Investment-grade corporate bonds with limited potential. We prefer market-sensitive segments.
  • We underweight bonds and focus on credit risk and off-benchmark themes. Duration: short.

Alternative investments / commodities

  • Gold under pressure in the short term due to strong dollar and higher real rates. Emerging markets should boost demand.
  • Saudi Arabia boosts oil price and cements supply deficit. US production stagnates.
  • Structural demand trends for industrial metals remain intact. However, the high prices are more susceptible to setbacks.


  • The Italian government crisis is weighing on the euro. Nevertheless, the exchange rate remains above 1.20 USD/EUR.
  • As expected, the British pound is benefiting from the Brexit deal. However, the virus brings uncertainty.
  • The Swiss franc remains very highly valued because of the many uncertainties.

Read the full article here.