Outlook for Investment Markets
World equity markets stumbled in late January and early February but have largely recovered from nervousness about the outlook for American and global economic activity. Looking ahead, the economic outlook is reasonable for world equities, though higher valuations and weakness in emerging markets suggests a replay of the strong price gains of 2013 is unlikely. Fixed interest temporarily performed well in January but the outlook is more challenging as bond yields, at home and overseas, look likely to rise this year. Property (local and global) also weathered the January volatility quite well but investors remain largely on the sidelines. Domestically, the already strong economy looks to have become even more buoyant in recent months.
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