Fund managers in the United States are tilting their funding recommendations to favour bonds as trade blockades widen the gorge between world economic leaders. The move, a Reuters poll found, was partly prompted by the desire to prevent a global trade war resulting from economic tensions between Beijing and Washington, DC.
Hopes are high that the global economy may remain steady and stable in the face of imminent changes although on the US side, a separate poll had shown that President Trump’s trade policies may jeopardize the economy.
Alan Gayle, president at Via Nova Investment Management, puts into perspective the idea that going by the economic realities on the ground, such as estimates on profits, the chances for stocks to rise and remain relatively stable are high and promising. The manager however fears that harsh economic policies are certain to bring about fragile conditions in the days ahead.
“The recent concern and market volatility seems to revolve around policy actions, specifically higher interest rates from the Federal Reserve and trade initiatives/restrictions from the Trump administration. These policy actions represent the greatest risk to the markets, in our view.”
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