Clarifying MM’s Macro view

Hi Jill,

Indeed many moving parts to your question much of which we have touched on this week but a quick summary is as follows:

• MM is bullish the reflation trade hence we believe bond yields, inflation and interest rates will rise over the coming years.
• Stock valuations in the US are very rich if you believe bond yields will move meaningfully higher but not if they head back down towards zero i.e. here lieth the key.
• We like banks and resources because we believe the above mentioned pickup in inflation and bond yields will not be transitory.
• We like CSL Ltd (CSL) hence our position but overall we envisage remaining underweight the Healthcare Sector over the coming year
• We believe banks are well positioned moving forward medium-term but we are not likely to increase our exposure at current levels.
• Quality definitely feels the way ahead in a market that’s rallying to fresh all-time highs, there are plenty of uncertainties at play today and we feel more comfortable holding the quality end of town in most sectors (but not all)

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ASX200 v US S&P500 Index

LAST UPDATED 31/07/2021 08:40

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ASX200 v US S&P500 Index

LAST UPDATED 31/07/2021 08:40