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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。

Portfolio tactics after Trumps win

Perspectives

Portfolio tactics after Trump's win

Steven Wieting

By Steven Wieting

Chief Investment Strategist and Chief Economist

November 10, 2016Posted InEquities, Investment Strategy, Investments and Fixed Income

Convening a special meeting to discuss the evolving outlook following the historic US election, The Citi Private Bank Global Investment Committee (GIC) left its asset allocation unchanged on 9 November 2016.  Global equities remain neutral, fixed income -1.0%, while cash and gold are slight overweights. Much like the case following the UK’s Brexit vote in June, fast-moving, volatile markets may give misleading signals about the likely path of longer-term returns.  We’re determined to observe markets carefully and only adjust allocations where the fundamental outlook has changed or valuations have improved.

Speculation over President-elect Trump’s likely policy course has already driven unusually large moves in many asset prices across the world, particularly in the Americas.  With no prior government record, and a very wide range of positive and negative policy proposals from an economic perspective, investors must adjust to a higher level of US policy uncertainty.  This might be mitigated by clarifying statements or plans from the Trump administration and Congress. However, like the case of Brexit adhering to campaign promises may reintroduce downside risks.

Today, long-term US interest rates jumped more than 20 basis points, the largest move in five years.  Some portion of that move can be ascribed to the likelihood of fiscal easing, with the unified Republican government able to both reduce tax rates and expand government investment spending on infrastructure.  However, a portion of the rise was also driven by rising inflation expectations – supply risks – and a modest jump in US sovereign risk premia.

Investors have been conditioned to buy large market dislocations and today’s early stock market declines were short-lived.  It is to be seen if future political risks both in the Americas and Europe coupled with potential Fed tightening will leave stock and bond markets to continue in their early post-election trend.

Heightened interest rate volatility was a high conviction view of the GIC in the event of united US government with a Trump victory.  We would not expect this volatility to be entirely isolated to the fixed-income asset class.  Lasting market volatility is also generally a prelude to economic volatility.

The US election results will provide a test of durability for many asset markets. While initially negative for some emerging markets including Latin America, regions that have low correlation to developed market economies may be worthy of enhanced consideration by the GIC in the future.