Global GDP growth continues to slow, with trade and tariff issues being a major contributory factor. The deteriorating macroeconomic outlook has been impacting investors’ decisions. The prices of perceived “safe haven” assets, such as gold and government-issued securities, have soared in recent months. The dollar, which is often perceived as a “global fear index,” has also been strong.

Stock prices have remained resilient. Even in an environment of falling earnings estimates (which are declining at a much faster rate than the historical average), equities remain close to record highs.

There are many moving parts in the fixed income outlook. The yield curve is still inverted. Inflation remains stubbornly low. The Fed’s policy course is not entirely clear.

For investors, the current environment presents challenges. A large over- or underweight in equities or fixed income seems risky.

Download our Quarterly Market Update and Outlook for Q4 2019.