Horizon Handout September 2021

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


  • The Eurozone economy is growing as expected. At a solid 2%, the temporarily higher inflation rate remains moderate.
  • In contrast, inflation in the US is remarkable. At more than 5%, the central bank cannot remain inactive for much longer.
  • The Fed will implement its exit from emergency policy cautiously so as not to stall the economy.


  • Western stock indices reach new all-time highs mainly driven by fundamentals. Chinese regulation weighs on emerging markets
  • Positive earnings revisions in cyclical market segments as a result of the reporting season no longer trigger outperformance.
  • Declining economic growth is increasingly shifting the focus to more defensive and structurally growing market segments.


  • The summer low in yields on safe haven government bonds seems to have been overcome. Duration should be kept short.
  • Spreads on IG bonds offer little potential. High-yield bonds have stable spreads despite existing risks.
  • In emerging markets, we favour high yielding government bonds and the local currency segment.

Alternative investments / commodities

  • Spread of delta variant pushes oil price down. Existing supply shortage speaks for prices rising again.
  • • Gold anticipates tighter monetary policy. With real interest rates rising, potential remains limited. Valuation: fair.
  • Industrial metals suffer from concerns about an economic slowdown. Structural, positive trends remain intact.


  • The US dollar benefits from the prospect of a reversal in monetary policy. The ECB will be able to take more time.
  • The British pound has slightly weakened recently. However, it remains in a narrow range at 0.85/0.86 pounds per euro.
  • The Swiss franc is again benefiting from Covid-19 worries and geopolitical uncertainties.

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