The Standard Chartered Bank says it sees room for equity market gains to extend as cooling inflation brings bond yields lower and sustains central bank rate cut expectations for the rest of the year.
“We remain overweight equities in foundation allocations and indicated that, within this, we maintain our preference for US and Japan equities and EM US dollar bonds.
We remain reluctant to chase gold higher, given crowded investor positions. In opportunistic allocations, we add buy ideas on Taiwan equities and China-US dollar bonds and close US energy sector equity and US inflation-protected bond buy ideas,” it said in a notice to its priority clients.
On equities, the bank said, “We remain overweight equities and believe they can outperform bonds and cash in a soft-landing scenario.