Diaphanum is neutral in equities and positive in fixed income and treasury in 2024

Madrid, Nov 29 (EFECOM).- The securities company Diaphanum shows a neutral stance on equities, government fixed income and alternative assets, while it is positive on treasury and private fixed income.

In the presentation of the market outlook for 2024, Diaphanum’s investment director, Miguel Ángel García, pointed out that the treasury is at very profitable levels after the European Central Bank (ECB) completed its rate hike process.

In this sense, they consider that after the historic increase in interest rates, three quarters of the objective has already been achieved, which is why they are in favor of there could be interest rate cuts in the second half of 2024.

With respect to fixed income, after a complicated year due to high volatility, Diaphanum is betting on a good return on government and corporate bonds.

In relation to government bonds, the entity explains that they present a very good risk-return ratio, considering that the market has exceeded its pessimism, bringing them to very attractive prices.

In corporate bonds, they recommend investment grade and high yield bonds with duration in the highest risk profiles.

Regarding equities, Diaphanum considers that valuations are below their historical average, so it still sees potential, if there are no significant downward revisions to results and bond yields fall.

Therefore, in equities they remain neutral and are committed to having greater weight in the US and emerging markets over Europe and Japan, and overweight in energy, technology and health.

Likewise, they believe, after a difficult year for business profits, in 2024 there will be interesting increases in the US and emerging markets, with more modest growth in the case of European companies.

In this sense, the member of the investment team of the manager Carlos del Campo has said that in general the companies “are not trading at high valuations, but large companies related to technology have risen a lot, making the indices they are presenting more expensive. very high valuations and revaluations.”

As explained by Diaphanum partner Rafael Ciruelos, “the current environment allows for durations in portfolios not only in governments, but in the rest of fixed income assets.”

For all this, they consider that the markets will continue to pay attention to the monetary policy decisions of the central banks, which in turn will closely follow what inflation does.

In relation to the latest increases in gold, Diaphanum explains it in the increase in demand due to inflation, and the strong increase in purchases by central banks.

They believe that having gold in the portfolio lowers volatility.

Regarding oil, they have pointed out that instability in the Middle East can at any time cause a rise in oil if circulation in the area is restricted, and they consider that demand depends on global growth and especially China.

They have explained that on the supply side, Saudi Arabia and Russia are restricting their production to keep prices high, which is contributed to by the lack of investment in new fields.

Regarding currencies, Diaphanum believes that the trend will be the weakness of the dollar, while they believe that the pound will continue to depreciate given the poor outlook for the economy, the yen will continue to be very weak and the Swiss franc is heavily intervened and they believe that will continue like this. EFECOM

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