Horizon Handout October 2022

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


  • Inflationary pressures remain high and Europe in an energy crisis. Consumers are unsettled.
  • The risks and stress factors are leading into recession, even if labour markets are still robust.
  • Inflationary pressure is too high: central banks must continue to tighten monetary policy even if the economy is slowing down.


  • Negative earnings revisions are likely to continue during the Q3 reporting season, in line with the economic slowdown.
  • Higher risks in Europe are accompanied by lower valuations. Europe offers catch-up potential.
  • Low investor positioning should limit downside potential. Year-end rally seems possible.


  • Rise in yields on safe government bonds continued unabated. Flattening of the US yield curve.
  • Risk premiums for emerging market bonds increased slightly. High-yield bonds in particular with widening spreads.
  • We underweight bonds and remain cautiously positioned on credit risk. Duration: less short than before.


  • Oil affected by weak global demand, but supply is still tight. A stronger price drop is unlikely.
  • Gold hit by strong dollar and higher real interest rates. Monetary policy turnaround necessary for sustained upward trend.
  • Industrial metals burdened in the short term by demand risks and dollar strength. Supercycle remains intact.


  • Despite the interest rate hikes, the euro remains weak. Other central banks were faster and seem more determined.
  • In addition to monetary policy, the uncertainty ahead of winter is a particular burden: How badly will the economy be hit?
  • Against the US dollar and the Swiss franc, the euro falls well below parity.