Forecasts point to ‘goldilocks’ soft landing but US nominal GDP only expected to return to secular stagnation levels.
Fed increasingly confident they have tamed US inflation but services still well above pre-Covid average levels
Growth has continued to outperform Value. Small cap has marginally outperformed large cap over three months but saw negative returns in January.
Growth sees a 5yr annualized return of 17.9% vs 10.7% for value.
The US has led a further decline in (most) regional market interest rate expectations in recent months as the Fed embarks on easing cycle with 50bps cut in September.
Markets are forecasting a more rapid pace of US cuts through to the end of 2025 than the Fed.
US ex Mag 7 and US equal weight 12m fwd PEs have seen a bigger recent re-rating than the aggregate market.
Value-focused US sectors such as financials have seen the largest re-rating over the last 3 months.
Distortion to US 2024 EPS growth generated by the high concentration of the US market, with US 2024 ex Mag 7 and US equal-weight growth expected to come in at just 7.2% and 4.5%, respectively, vs 11.3% for the aggregate US market.
Forecasts for 2025 show double-digit EPS growth is expected across most regions.
Oops! Something went wrong while submitting the form
