Fri, Mar 29, 2024
A A A
Welcome Guest
Free Trial RSS pod
Get FREE trial access to our award winning publications
Alternative Market Briefing

Rising rates open new vistas for stock pickers, market rotation already in full swing

Monday, February 06, 2017

Matthias Knab, Opalesque:

Rising Rates Open New Vistas for Stock Pickers AllianceBernstein writes on Harvest Exchange:

Rising rates are typically good for stocks, especially when they're rising because of a strengthening economy. That should mean better days ahead for many postcrisis laggards. But a lot will depend on how inflation behaves.

After a series of head fakes, interest rates and potentially inflation appear to be coming out of their funk. Governments across the globe are shifting from monetary to fiscal stimulus to reinvigorate growth, with the US at the forefront. An array of proposed pro-business policies from the new US presidential administration-including lower corporate taxes, repatriation of cash held offshore and looser regulation-has lifted confidence in US and, in turn, global growth.

So what does all this mean for stocks? Each rate cycle has been unique, but history can give us clues to what may lie ahead.

As we wrote in the wake of the 2013 Taper Tantrum, stocks generally thrive when rates rise . Surprisingly, during the 17 bouts of rising 10-year US Treasury bond yields since 1970, our updated research shows that large-cap global stocks rose 17.4% annualized, outperforming their long-term annualized average gain by more than eight percentage points.

Rising-Rate Champions

Rising rates h......................

To view our full article Click here

Previous Opalesque Exclusives                                  
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. KKR raises $6.4bn for the largest pan-Asia infrastructure fund[more]

    Laxman Pai, Opalesque Asia: The New York-based global investment firm KKR has raised a record $6.4bn for its second Asia-focused infrastructure fund, underlining investors' continued appetite for private markets. According to a media release from the alternative assets manager, the figure top

  2. Bucking the trend, top hedge fund makes plans for a second SPAC[more]

    From Institutional Investor: SPACs aren't dead. At least not to the folks at Cormorant Asset Management. The life sciences firm, whose hedge fund topped its peers in 2023, is confident it will match the success of its first blank-check company. Last week, the life sciences and biopharma speciali

  3. Benefit Street Partners closes fifth fund on $4.7 billion[more]

    Bailey McCann, Opalesque New York: Benefit Street Partners has closed its fifth flagship direct lending vehicle, BSP Debt Fund V, with $4.7 billion of investable capital across the strategy. Benefit Street invests primarily in privately originated, floating rate, senior secured loans. The fun

  4. 4 hedge fund themes that are working in 2024[more]

    From The Street: A poor earnings report from Tesla (TSLA) has not hurt the indexes on Thursday. The decline in Tesla stock, which is losing its position in the Magnificent Seven pantheon, is more than offset by strong earnings from IBM (IBM) and ServiceNow (NOW) . In addition, the much higher-t

  5. Opalesque Exclusive: A global macro fund eyes opportunities in bonds[more]

    Bailey McCann, Opalesque New York for New Managers: Munich-based ThirdYear Capital rebounded in 2023, following a tough year for global macro. The firm's flagship ART Global Macro strategy finished the year up 1