Capital Market Outlook
Adapting to a Changing World
In this issue: We believe tariffs are part of a larger effort to update trade and financial architecture in the face of a multipolar global economy. That effort is likely to put pressure on the federal budget deficit and require broader equity market performance to maintain the uptrend.
Staying Grounded in the Fundamentals
In this issue: History suggests the third year of a bull market may be choppier than earlier phases, but that does not necessarily mean the end of the uptrend. We believe demand-growth fundamentals and inflation trends are more likely to tell the long-term story.
Monitoring the economic winds
In this issue: We believe it’s implausible that short-term selling by a subset of investors could drive long-term valuations. Internationally, Europe’s rebound could be good news for some U.S. sectors, while economic entanglements make the investment case for China a challenge.
Staying focused on trends, not headlines
In this issue: We see high-level diversification across regions, sectors and market capitalizations as a key area of focus for investors. Keeping an eye on big-picture trends can help navigate short-term shifts like lower equity risk premium and tariff impacts.
Staying focused on trends, not headlines
In this issue: Overall market trends remain generally positive, which could be good news both at home and abroad. Relative calm at the index level could be masking increased volatility at the individual stock level, however.
Keeping track of an increasingly fragmented global economy
In this issue: We believe China’s economic strategy reflects a global economy that’s more fragmented than integrated. Alongside other recent economic developments, investors have a lot to consider as they survey their options at home and abroad.
Rolling with the Changes
In this issue: We believe tariffs are likely to remain a blunt instrument of U.S. diplomacy and remain watchful about what they could mean. Absent further details, however, the economic base case remains continued expansion and risk-asset outperformance.
Rolling with the Changes
In this issue: Stubborn inflation trends appear to be keeping further rate cuts on hold. On the brighter side, we see potential for a surge in foreign investment to the U.S. this year — and DeepSeek's innovations could ultimately increase global AI adoption.
Checking in on the Fundamentals
In this issue: We believe continued market expansion will depend on more balanced growth both here and abroad, as well as solid fundamentals. Those fundamentals include economic growth, inflation and earnings, as well as the financial health of U.S. consumers.
Navigating the Intersection of Economy and Policy
In this issue: The economy is top of mind for investors heading into 2025, but evolving policies may also have an impact. Prominent among them: How the rest of the world responds to U.S. protectionism and the potential effects of sweeping anti-immigration policy.
Get Ready for Some (Potential) Punches
In this issue: Several sustainable drivers of economic growth support a positive backdrop for 2025, but investors should be prepared to take potential punches from inflation, trade policy, the pace of Artificial Intelligence adoption, and a high federal budget deficit.
Another Year of Upside Surprises?
In this issue: 2025 may be a year of upside surprises, as rising and broadening corporate earnings, a solid U.S. consumer, and the structural shift toward easier monetary and fiscal policies should combine to support economic growth and shape future market returns.
