MEETING PURPOSE
Our investment team aim to meet every week to discuss the macro environment and how this could impact our current and future portfolio construction.
KEY TAKEAWAYS
- Equity markets remain bullish, with growth stocks catching up to value stocks recently
- Commodities showing strength, particularly in energy, industrial metals, and precious metals
- Technical indicators suggest maintaining overweight positions in risk assets despite some valuation concerns
- South African asset managers like Orbis and Coronation have delivered exceptional performance globally
TOPICS
Market Performance and Positioning
- Growth stocks have caught up to value stocks in S&P 500 over the past 6 weeks
- Utilities and materials sectors outperforming year-to-date in US
- MSCI World up 9% YTD, S&P 500 up 6.3% YTD
- Fixed income returns positive but modest YTD (4% for gov’t bonds, 5.25% for high yield)
- Team maintaining overweight equity positions based on technicals and fiscal stimulus
Alpine Macro Outlook
- Alpine Macro remains bullish on equities for 2025 and expects ongoing volatility
- US market leadership driven by superior profit growth and productivity
- Fiscal expansion supporting growth in US, Germany, Japan and China
- Inflation concerns tempered by weak agricultural commodity prices
Commodity Markets
- Oil prices supported by OPEC production discipline and strong demand
- Industrial metals showing strength on supply constraints and demand outlook
- Precious metals rallying, with platinum up 65% in past two months
- Gold-silver ratio at 86, suggesting potential for silver to outperform
Technical Positioning
- Most equity indices showing bullish chart patterns, poised for further gains
- Bond markets range-bound, yields struggling for direction
- Commodity indices consolidating but maintaining upward bias
- Bitcoin breaking out to upside after period of consolidation
Portfolio Strategy
- Increasing allocation to alpha-generating active managers in offshore fund
- Maintaining overweight to commodities, particularly industrial and precious metals
- Considering increased exposure to diversified miners (e.g. Anglo, BHP, Glencore)
- Monitoring emerging market opportunities, seeking high-conviction managers
Next Steps
- Review cash allocation in light of bullish technical signals
- Evaluate increasing exposure to industrial metals and miners
- Continue research on infrastructure investment opportunities
The content of this article is for information purposes only and does not constitute an offer or invitation to any person. The opinions expressed are subject to change and are not to be interpreted as investment advice. You should consult an adviser who will be able to provide appropriate advice that is based on your specific needs and circumstances. The information and opinions contained herein have been compiled or arrived at from sources believed to be reliable and given in good faith, but no representation is made as to their accuracy, completeness or correctness.3