Welcome to the February edition of “Market Perspectives”, the monthly investment strategy update from Barclays Private Bank, which is also available to download as a PDF.
The start to the year has shown the impact of exogenous shocks as a risk to financial markets as opposed to a true weakening in fundamentals, something we highlighted in our Outlook 2020.
Tensions between the US and Iran rose significantly and unsettled investors in early January. In the alternatives article, we consider oil’s vulnerability to supply-side shocks and how gold can be used successfully as a diversifier in a multi-asset portfolio.
The debate on globalisation continues to be centre stage, with a signed “phase one” US-China trade deal. Arguably the main event of 2020 shaping the future of globalisation will be the race to the White House, which gets under way in February for Democrats, with the influential Iowa caucus and New Hampshire primary.
The record-setting rally on Wall Street continued in January, with all three indices at fresh highs as investors tuned out geopolitical “noise” and focused on improving global growth, accommodative central banks and consensus-beating fourth-quarter US earnings.
However, the impact of the coronavirus news on markets shows that investors are not far away from doses of reality, with elevated equity valuations and modest growth expectations tempering the potential for upside surprises.
After a strong 2019 for bonds, investors are looking for pockets of value. We look for opportunities for generating returns against a backdrop of negative yielding debt and the potential for sharp climbs in bond yields.
Finally, January’s news cycle was filled with both the World Economic Forum in Davos and wildfires in Australia. The link between them is climate change. Following our climate change insights in the Outlook 2020, we explore the physical risks that investors will need to consider to protect their portfolios from such extreme weather events.
Jean-Damien Marie and Andre Portelli
Co-heads of investment, Private Bank
A new optional regional transport tax for businesses, introduced in France’s 2025 budget, aims to fund eco-friendly mobility projects. ...
Read More
A judge has authorised a dive to inspect the wreckage of a plane in the sea off Antibes. The plane crashed into the Mediterranean on September 11 1968...
Read More
In France, drinking water is heavily contaminated with "forever pollutants," particularly trifluoroacetic acid (TFA), as revealed by two studies from ...
Read More
The trial of the Tunisian man accused of the murder of three people in the Nice Basilica attack is continuing in Paris. Yesterday the families of the ...
Read More
Four cities in the Provence-Alpes-Côte d'Azur (PACA) region made Booking.com's 2025 list of the "most welcoming destinations in France." ...
Read More
