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1Q 2018 Outlooks (Wellington)

1st Quarter

Thought leaders from Wellington Management provide their outlook on issues that may influence markets and portfolios going forward.


Global Equities Outlook: Regional opportunities for 2018

Berger_Joshua_3187-6-Edit
TravisMiley
AlexNegroski

by Josh Berger, CFA, CMT, Equity Strategist
Travis Miley, Equity Portfolio Specialist 
Alex Negroski, CFA, Product Management Analyst

We believe the outlook for global equity markets remains broadly positive. 

  • Going into 2018, we expect the backdrop for global equity markets to remain supportive.
  • We see interesting opportunities in stocks with exposure to European growth, and Japanese companies benefiting from corporate and governance reforms.
  • Risks to our constructive outlook for equities include potential earnings disappointments, central bank policy errors, a hard landing in China, and—while unlikely in our view—a significant geopolitical event.

 

View PDF »

 

Global Fixed Income Outlook: The big unwind: Policy normalization
and its market implications

JohnButler
TobyJohnston
GeorgeChristou
CampeGoodman

by John Butler, Global Bond Strategist;
Toby Johnston, Global Bond Strategist;
George Christou, Currency Strategist;
Campe Goodman, CFA, Fixed Income Portfolio Manager

Global growth momentum remains strong, and the outlook is constructive with a lift in global trade and emerging signs of a global capital-spending cycle. But inflation pressures remain muted despite the low level of unemployment across many developed markets. 

  • The pace at which central banks can normalize policy will depend on how quickly capital investment can translate into productivity gains, tempering inflation pressures. 
  • The global shift by central banks toward greater tightening is likely to challenge higher-volatility currencies with deteriorating domestic backdrops. 

 

View PDF »

 

Multi-Asset Outlook: Can the Party Go On?

nanette-thumb

by Nanette Abuhoff Jacobson, Managing Director and Multi-Asset Strategist for Wellington Management and Global Investment Strategist for Hartford Funds

As central banks remove their accommodative policies, many are wondering if the party can continue with less punch in the bowl.

  • The global economy should be able to cope with moderately higher rates as central banks take a gradual approach to the removal of accommodative policy. I expect fundamentals to support risk assets in 2018.
  • I favor equities over bonds, and European and Japanese equities over US equities.
  • I believe that stability in China and commodity prices should benefit emerging markets. 

Global Commodities Outlook: Favorable supply, demand, and producer dynamics point to continued strength in 2018

DavidChang
JoyPerry

by David Chang, CFA, Commodities Portfolio Manager
Joy Perry, Investment Director

A new upcycle, spurred by broad-based supply restraint, is accelerating a rebalancing of key commodity markets. Healthy global demand continues to indicate synchronized strength in 2018. 

  • We believe commodities are in a new upcycle, spurred by supply restraints across the commodities complex that we expect to continue in 2018. 
  • Oil and metals have seen falling inventories and a dearth of new production projects. 
  • Commodities are a diverse asset class; today, the various subcategories are all at different points in their respective cycles.

 

View PDF »

 


All investments are subject to risk, including the possible loss of principal. Fixed Income risks include credit, liquidity, call, duration, and interest-rate risk. As interest rates rise, bond prices generally fall. Foreign investments can be riskier than U.S. investments due to the adverse effects of currency exchange rates, differences in market structure and liquidity, as well as political and economic developments in foreign countries and regions (e.g., “Brexit”). These risks are generally greater for investments in emerging markets

The views expressed here are those of Wellington portfolios managers. They should not be construed as investment advice. They are based on available information and are subject to change without notice. Portfolio positioning is at the discretion of the individual portfolio management teams; individual portfolio management teams and different fund sub-advisers may hold different views and may make different investment decisions for different clients or portfolios. This material and/or its contents are current as of the time of writing and may not be reproduced or distributed in whole or in part, for any purpose, without the express written consent of Wellington Management or Hartford Funds.

 

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