Following deeply oversold conditions at the end of 2018, equities rallied strongly in the first months of 2019. After two sharp but brief corrections in May and August, the rally continued on hopes for a trade deal and more accommodative actions from the Federal Reserve and the ECB. During this impressive rally, the deviations from fundamentals have increased further and in the case of corporate earnings have reached an extreme.
With US elections ahead, a very unpredictable US President and financial markets dominated by central banks‘ actions, writing an outlook is not an easy task. On the following pages, we will provide you with our thoughts and views and a roadmap for the first half of 2020 and beyond.