Horizon Handout October 2021

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


  • As expected, the economy was very strong in summer. In autumn, the upswing will slow down somewhat.
  • One issue is supply bottlenecks, another is inflation. Central banks are coming under pressure to act.
  • The ECB can steer monetary policy under its flexible pandemic purchase programme. Interest rate turnaround a long way off.


  • Western equity indices near all-time highs. Chinese regulation weighs on emerging markets.
  • Corporate profits should increase again next year, but growth rates should decline. Asia with catch-up potential.
  • We remain constructive on equities and consider a significant correction unlikely.


  • Safe-haven government bond yields resume their rising trend after the summer low.
  • In view of high valuations, we are taking a defensive stance on corporate bonds.
  • In emerging markets, we see further upside potential in high-yield government bonds.

Alternative investments / commodities

  • Oil price rally since the beginning of the year was followed by consolidation in Q3. Oil supply deficit supports until end of year.
  • Gold anticipates tighter monetary policy. Risks such as geopolitical conflicts harbour surprise potential.
  • Industrial metals suffered from the cooling of the reflation trade. However, fundamental drivers remain intact.


  • The US dollar is benefiting from the prospect of a monetary policy turnaround and increased uncertainties
  • Little news on the British pound: It is fluctuating at 0.85/0.86 pounds per euro. Can the Bank of England provide a boost?
  • Euro with interim recovery against the Franc. Can the Swiss currency now benefit from rising uncertainties?

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