A lot of movement below the surface in equities

Current market commentary

The constant alternation between growth concerns and reflation hopes has dominated the last few weeks and is likely to continue to characterise the coming months. Most recently, asset classes that had performed best since the beginning of the year tended to be among the biggest losers. Energy and financial stocks fell, as did oil and industrial metals, while defensive stocks and the US dollar celebrated a comeback. This is probably due to the (for the time being) lack of a further rise in yields in safe bonds. In addition, profit taking and rebalancing flows from pension funds at the end of the quarter probably played a role, as did the renewed lockdown measures in Europe. In any case, the environment for investors has not become any easier, as there are no clear trends at the moment. Against this backdrop, we believe it makes all the more sense to balance one's portfolio: to focus on megatrends over the long term, but also to take advantage of the opportunities offered by a broad economic recovery.

Short-term outlook

In mid-April, the Q1 reporting season in the US picks up significantly, starting with the corporate figures of the major banks. After the 2020 P/E expansion, earnings
growth should drive the markets this year. The market is thus eagerly awaiting Q1 key figures and corporate outlooks. G20 finance ministers and central bank governors meet on 7-8 April.
On Tuesday, Eurozone economic confidence (Mar.), US consumer confidence (Mar., Conference Board) and German inflation data will be released (Mar.). Japanese industrial production (Feb.), official Chinese purchasing managers' indices (Mar., PMI), US Chicago PMI (Mar.) and eurozone inflation data (Mar.) will be released on Wednesday. This will be followed on Thursday by the March industrial PMIs for the US (ISM, Markit), Europe (Markit) and China (Caixin) as well as German retail sales (Feb.). The week will be concluded with the US labour market data on Friday.