We combine deep qualitative analysis by our team of investment specialists with powerful quantitative analysis from our proprietary software to inform an unconstrained approach for strong, risk-adjusted returns.
From a macroeconomic perspective:
• The US: Unshaken economic acceleration
US economic growth has accelerated in Q3, shaking-off the negative economic impact caused by hurricanes Harvey and Irma over the summer. Growth remains supported by strong consumer sentiment and a stark rebound in industrial activity going into Q4. With an increase in underlying inflation pressures coupled with stronger-than-expected GDP growth, nothing stands in the way of a rate hike in December.
• The UK: Sterling ascending
The services sector was the main growth engine of the UK in Q3, fuelled by an expansion in private consumption. Meanwhile, the increasingly tight labour market has produced another month of negative real wage growth. Going forward, we expect a decline in price pressure towards year end to alleviate the pressure on purchasing power. Turning to industry, full order books and buoyant export demand point to further expansion in the manufacturing sector, supporting our view of a turnaround in exports in Q4.
• The Eurozone: All guns blazing
The Euro area economy has stepped up a gear in its cyclical recovery, supported by a significant acceleration in German and Italian economic activity. Going into Q4, industrial sector sentiment remains buoyant with the Manufacturing PMI standing at a 17-year high and pointing to further expansion in output. Adding to this, optimistic consumer confidence should support services sector growth in Q4. Meanwhile, price pressures remain subdued, leaving the ECB on the side-lines.