If you missed our October 27 webinar, watch the replay here.

Key Points

Economic Outlook:

• The 2023 GDP outlook is turning out better due to labor market and household resiliency.
• Inflation still elevated but continues downward glide path. Wages and service inflation are declining more slowly.
• Fed likely at or near the end of its hiking cycle, but expected to remain higher for longer.
• Recent increase in 10 year treasuries if sustained will impact consumer and corporate spending.
• Expecting modest GDP growth in 2024.
• Banks are reducing lending to consumers and businesses.

Investment Strategy:

• Geopolitical risk and trade tensions remain elevated, highest risk to our forecasts and supports modest defensive allocation.
• Volatility may create good buying opportunity in all but a worst-case scenario.
• Likely first step to reach neutral equity exposure will be to focus on high-quality US stocks selling at reasonable valuations.
• Continue to avoid European and Asian equities.
• Recent sell-offs in bonds likely, creating a buying opportunity.
• Maintaining focus on quality and below average duration.