Perspectives Blog

Could tapering be good for stocks?

Fred Copper, Senior Portfolio Manager | December 16, 2013

Despite all the discussion surrounding quantitative easing (QE), there has been little theoretical justification for the link between QE and equity prices. Europe provides a glaring counter-example of the impact of central bank policy on financial markets. Once the psychic umbilical cord of QE is cut (tapered), the market may actually be cheered by the end of what has always been perceived as a temporary and extreme form of life support. Few i…

Stairs up, elevator down

Jeffrey Knight, CFA, Global Head of Investment Solutions and Asset Allocation | August 18, 2014

…ion as summer draws to a close. Chief among these, we think, is the prominent slowdown in economic growth across Europe. Overall GDP growth across the eurozone in Q2 was 0.0, decelerating from its modest .2% trajectory during this year’s first quarter. The effects of this slowdown can readily be observed in the equity, bond and currency markets across Europe. This slowdown may pass, of course, or even prompt the European Central Bank to initiate…

Special report – Commodity markets outlook

Columbia Management, Investment Team | July 21, 2014

…ket. Consequently, developments in the Ukraine, for example, have no bearing on the U.S. natural gas market. The European natural gas market certainly is affected, however. But overall we believe that Europe and Russia’s interdependence is too great for there to be any long-term impact from the problems in the Ukraine, where we anticipate that the situation will be resolved diplomatically without any serious disruption to supplies from Russia int…

Global asset allocation outlook (August 2014)

Columbia Management Global Asset Allocation Team, | September 8, 2014

…cial market volatility. This volatility is most visible in currency markets. For example, economic stress across Europe has created pressure on the euro. Some of this pressure has been intensified by geopolitical developments in Ukraine and in the Middle East. In the eurozone, economic data — both hard and forward looking sentiment indicators — has been disappointing. Inflation data in Europe has been particularly weak, prompting the European Cen…

Second quarter U.S. corporate earnings wrap-up

Tom West, Director of Equity Research | August 18, 2014

Non-cyclical sectors slightly out performed cyclical sectors during the quarter. In technology, the U.S. is improving, Europe is still not strong and developing markets lag. The healthcare sector improved, but it is still a question mark for the second half of the year. As the economic recovery matures, we have seen a fairly consistent pattern in quarterly earnings: estimates come down during the course of the quarter, and then beat the “lower…

Global Asset Allocation Outlook (as of February 24, 2014)

Columbia Management Global Asset Allocation Team, | March 10, 2014

Markets had a difficult start to the year. After experiencing negative returns in January, both U.S. and European equities recovered in February and are now slightly positive for the year. The best returns have come from U.S. small-cap equities along with shares of equities domiciled in the periphery of Europe. These two broad groups are both up mid-single digits. Emerging market equities continue to lag developed market performance. And, Japane…

ECB asset purchases — Bazooka or damp squib?

Martin Harvey, Fund Manager, Threadneedle International Ltd | September 22, 2014

With inflation expectations declining to the levels that preceded the recent shift in policy, should the ECB and the financial markets be worried? In our view, the ECB probably won’t be wholly impressed by the reaction of inflation expectations to recently announced measures, and will be keeping a close eye on favored measures. We believe that we would need to see a further significant deterioration in growth and inflation expectations to kick…