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Please be advised that future verbal and written communications from the bank may be in English only. These communications may include, but are not limited to, account agreements, statements and disclosures, changes in terms or fees; or any servicing of your account.

Por favor, tenga en cuenta que es posible que las comunicaciones futuras del banco, ya sean verbales o escritas, sean únicamente en inglés. Estas comunicaciones podrían incluir, entre otras, contratos de cuentas, estados de cuenta y divulgaciones, así como cambios en términos o cargos o cualquier tipo de servicio para su cuenta.

Informamos que as futuras comunicações do banco, verbais e escritas, podem estar disponíveis apenas em inglês. Essas comunicações podem incluir, entre outras, acordos de conta, extratos de conta e divulgações, alterações aos termos ou tarifas, ou qualquer tipo de serviço pertinente à sua conta.

仅此通知,本行即日起发出的口头及书面通信可能将只提供英文版本。这些通信可能包括但不限于账户协议,账单和通知,条款或费用变更;或任何为您账户提供的服务。

Please be advised that future verbal and written communications from the bank may be in English only. These communications may include, but are not limited to, account agreements, statements and disclosures, changes in terms or fees; or any servicing of your account.

Por favor, tenga en cuenta que es posible que las comunicaciones futuras del banco, ya sean verbales o escritas, sean únicamente en inglés. Estas comunicaciones podrían incluir, entre otras, contratos de cuentas, estados de cuenta y divulgaciones, así como cambios en términos o cargos o cualquier tipo de servicio para su cuenta.

Informamos que as futuras comunicações do banco, verbais e escritas, podem estar disponíveis apenas em inglês. Essas comunicações podem incluir, entre outras, acordos de conta, extratos de conta e divulgações, alterações aos termos ou tarifas, ou qualquer tipo de serviço pertinente à sua conta.

仅此通知,本行即日起发出的口头及书面通信可能将只提供英文版本。这些通信可能包括但不限于账户协议,账单和通知,条款或费用变更;或任何为您账户提供的服务。

Investing-after-the-US-midterms

Investing after the US midterms

Charlie Reinhard

By Charlie Reinhard

Head - NAM Investment Strategy

November 9, 2018Posted InInvestments and Investment Strategy

For the US midterm elections, voter engagement spiked and when the results were announced pollsters were finally able to exhale following 2016’s Presidential election surprise. In the end, Democrats picked up enough seats in the House to gain control with several seats being counted while the Republicans added at least 2 more seats in the Senate to maintain their majority. Now that the election is over, investors should look for markets to anchor to the fundamentals which include a healthy economy, growing profits and a Fed that is slowly raising interest rates

Following tax cuts and deregulation, US large caps’ expected long-term earnings growth has caught up with small cap stocks which, in turn, have also seen their higher debt burdens impair relative performance as rates have risen. As we advance deeper in the business cycle we encourage investors to upgrade the inherent quality of their portfolio holdings. Large caps are less volatile than small caps and dividend growers have historically performed competitively with less risk than the market at large. The Citi Private Bank Global Investment Committee (GIC) also looks to take advantage of the opportunities provided by less exhausted bull markets trading at deep valuation discounts and higher dividend yields than US stocks. In addition to solid risk-adjusted performance and high dividends, infrastructure stocks have been less sensitive to trade developments given the relatively domestic nature of many physical and digital investment projects.

The Fed tightening cycle underway will turn three years old next month. We look for another rate increase in December and gradual tightening next year. By contrast, the European Central Bank (ECB) is not expected to raise rates until after next summer. As a result, we side with short-duration, high-quality US bonds, high yield, floaters and bank loans versus low yielding developed country sovereigns with emerging market debt also deemed attractive

Following the midterm elections, investors will still need to navigate trade rhetoric, Brexit, central bank developments and a host of other issues. Enduring portfolios that look beyond borders to capture favorable fundamentals and valuation readings can help investors chart their course as these and other events unfold.

Clients can read our full thoughts on the North American markets in North America Investment Strategy – Investing after the Midterms.