Markets & Economy

Midyear Market Outlook

What to Expect From Markets Through Year-End

June 25, 2018
Economic expansion, strong earnings growth, and moderate monetary tightening appear to provide a positive market environment.

Key Points

  • Moving into the second half of 2018, the global economic expansion appears intact, although momentum appears to be slowing in Europe and Japan.
  • Earnings growth has been strong and underlying trends are positive, but peak levels likely were achieved in the first half of the year.
  • Asset classes appear relatively expensive in most global regions, but higher Treasury yields have improved U.S. credit valuations in an absolute sense.
  • The U.S. Federal Reserve continues to pursue a moderate course of rate hikes, but U.S. dollar appreciation is creating headwinds for emerging markets.

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