Horizon Handout July 2021

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


  • The economy in the Eurozone is picking up. The inflation rate is still moderate at 2%.
  • Inflation is currently in the spotlight in the US. Both overall and core inflation are rising strongly.
  • Monetary and fiscal policy remains supportive. However, the Fed has begun to indicate a turnaround.


  • Positive earnings revisions thanks to the economic recovery. Estimates for next year are subject to greater uncertainty.
  • Equities remain expensively relative to their own history, especially in the US. However, there is no attractive alternative.
  • Equity markets are unlikely to have much upside potential at the index level in Q3, but we see opportunities for Asia.


  • Safe government bonds continue to move in difficult waters - caution remains advisable.
  • Euro corporate bonds: Avoid duration risks, current interest rates at the short end are more attractive.
  • In emerging markets, we favour high-yield government bonds and the local currency segment.

Alternative investments / commodities

  • Interest rates remain a major burden for gold. Inflation concerns as well as central bank and jewellery demand support.
  • Supply response to demand recovery determines oil price. Upside price surprises cannot be ruled out.
  • Industrial metals correct. Previous price increase makes itself noticeable in the industry. Dependence on China decreases.


  • The statements by the Fed after their last meeting have strengthened the US-dollar, at least temporarily.
  • Little news on the British pound. After a strong first quarter, it has settled at 0.86 pounds per euro.
  • The swiss franc had worked its way back up with small steps, but fell back somewhat after the last SNB meeting.

Read the full article here.