- Crosscurrents — Although there are no material changes to our regional or sector recommendations this month, there have been some noteworthy crosscurrents.
- Regional Crosscurrents — Improved optimism about earnings in Europe ex. the U.K. is offset by valuations that are still relatively unattractive, so that the region remains Underweight.
- Sector Crosscurrents — Similarly, the Underweight Energy sector has also seen some improvement in earnings optimism, but that has not been enough to offset the sector’s relatively unattractive valuation.
- Food for Thought — The shifting of GICS weights in the MSCI ACWI benchmark has implications for the materiality of specific ESG issues in sector strategy at any given point in time.
Michael Geraghty is the Global Markets Strategist at Cornerstone Capital Inc. He has over three decades of experience in the financial services industry including working as an investment strategist at UBS and Citi.