Multi-managers remain upbeat on their outlook for global markets despite the International Monetary Fund cutting its global economic growth forecast.
In its latest World Economic Outlook the IMF said it expects global economic growth to reach 2.9 per cent this year and 3.6 in 2014, representing respective cuts of 0.3 and 0.2 per cent from its previous estimates.
However, Fidelity Multi Asset Defensive fund manager Trevor Greetham believes the growth to date should continue and the current overall path looks relatively buoyant from an equities point of view.
He says: “We see strengthening global growth, with the US, Europe, Asia and the emerging markets all having posted stronger business confidence surveys recently. The continuing recovery in global growth should see earnings expand.”
Right now he is most positive on the US and Japan as a result of their loose fiscal and monetary policy mixes and strong growth.
He says: “Both countries should benefit from the trend we see of dollar strength over the next few years. But we need to see inflation pick up, stronger US housing data and the current stand-off about fiscal policy in Washington resolved.”
Henderson Multi-Manager Income & Growth manager James de Bunsen is also generally positive but prevailing tailwinds, particularly the timing of the reduction of quantitative easing, remain a concern.
He says: “We still favour equities, with a bias towards lower-beta risk assets over bonds. Regionally, we continue to like US and Japan and believe there is a greater probability that these economies can generate growth.”