At Javelin Wealth Management, we continue to expect inflationary pressures to be persistent. Markets last week seemed to have put a stamp of approval on this somewhat contrarian view.
Here’s a short recap:
1. Inflation: The tight labour market will give room for the FED to raise rates again. The potential rate hike “skip” in June should not be interpreted as a hard stop as the economy is still growing faster than what central banks would be comfortable with.
2. Investments: Javelin is favouring fixed-income securities over equities due to their favourable risk-return profile amidst the current uncertainties.
3. AI boom: If we were to strip out AI-related stocks from the S&P500, we would be down for the year. While AI is here to stay, markets and analysts have struggled to understand the scale of AI growth as evidenced in the inaccuracy of analyst forecasts of Nvidia’s latest results.
4. China: It is clear that China’s economic recovery momentum is losing steam. A reliable policy and long-term structural reforms are required to revive investor confidence and entice foreign investors back to China.
At Javelin, we consistently hold fast to our “client-first” ethos. Long-term wealth management is more than just investment. We put heavy emphasis on customization to ensure that our portfolios are aligned with each of our client’s wealth goals.
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