Risk assets remain in demand

Economics:

• Gloomy pandemic winter in Europe and the USA. However, despite virus mutations, the outlook for spring is good
• Biden delivers: calmer foreign and trade policy is good for the world, with a strong fiscal stimulus
• 2021: strong growth in large parts of the world; monetary and fiscal policy very expansionary; and inflation slowly picking up

Equities:

• The global equity market recently reached an all-time high, despite temporary market dislocation. Outlook remains positive
• Small caps have the wind in their sails. Growth stocks outperformed value stocks, despite rising interest rates
• We remain medium overweight in equity and have a cyclical bias, for the time being, following the recent risk reduction

Bonds:

• Inflation concerns are pushing up yields on European and US government bonds. This environment is likely to persist
• Corporate bonds with inflows and falling risk premiums. EUR high-yield bonds are becoming increasingly unattractive
• We are underweight bonds and focus on credit risk and off-benchmark themes. Duration: short

Commodoties:

• Gold is currently not in demand, with the price temporarily falling below USD 1,800 per ounce. We remain optimistic
• Brent oil now above USD 60 per barrel. Supply deficit thanks to restrictive OPEC+ provides tailwind
• Industrial metals continued their positive price trend. Rising demand due to the economic recovery is supporting

Currencies:

• EUR/USD with slight correction. Overarching picture remains intact, but euro rise could be delayed
• As expected, GBP is heading upwards. The Bank of England’s rate changes remain on hold
• CHF is fluctuating, with little amplitude, around CHF1.08 per-euro and, therefore, remains very stable