Market Quote: Outlook Outtakes III (Growth strategies, Private markets, Infrastructure stocks)
Author: The editor's desk
December 29, 2023
Members of AGF’s Investment Management Team weigh in on the week that was in global financial markets. In this edition, even more highlights from AGF’s Outlook 2024 publication.
Grow Op
…It’s a tough call, but it looks like interest rates may have peaked and that inflation should stay well contained and under control at current levels. And if so, that should result in a better backdrop for risk taking, and by extension, growth stocks. The real key here is how the economy evolves over the next six months. If the broader U.S. economy can remain resilient into next year in the face of elevated rates, then the stock market can do well next year. Meanwhile, some areas of the stock market have de-rated so much that they are now starting to offer interesting prospects for appreciation… (Growing Pains)
Privately Speaking
…while the current environment has resulted in some decidedly mixed returns to date, an expected end to the rate-hiking cycle could be a catalyst for an increase in positive outcomes as capital sitting on the sidelines is re-deployed across a broader swath of strategies, including those that invest in privately held equities and credit… (A Turn for the Private Good)
Constructive on Construction
…While lower rates will lead to lower financing costs, higher financing availability and better return on investment, for these types of cyclical stocks, we are particularly bullish on E&C companies with exposure to U.S. infrastructure construction projects that should be supported for years to come by trillions of dollars in government programs like the Infrastructure Investment and Jobs Act (IIJA) and the Inflation Reduction Act (IRA), as well as ongoing reshoring and energy transition initiatives… (What if There’s a Recession (And Central Banks Start Cutting Rates)?)
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The views expressed in this blog are those of the author and do not necessarily represent the opinions of AGF, its subsidiaries or any of its affiliated companies, funds, or investment strategies.
Commentary and data sourced from Bloomberg, Reuters and other news sources unless otherwise noted. The commentaries contained herein are provided as a general source of information based on information available as of December5, 2023 and are not intended to be comprehensive investment advice applicable to the circumstances of the individual. Every effort has been made to ensure accuracy in these commentaries at the time of publication, however, accuracy cannot be guaranteed. Market conditions may change and AGF Investments accepts no responsibility for individual investment decisions arising from the use or reliance on the information contained here.
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