Investment director Tom Stevenson provides the view from Europe, including the impact of the vaccine rollout, global trade and economic policies. Tom notes that the European Central Bank (ECB) is becoming increasingly concerned about the direction of bond yields. They are worried about the impact it will have on funding costs for individuals and businesses. On March 11, the ECB said they will leave the size of the bond buying program unchanged, but that it will increase its pace. Tom notes that this is a sign they are trying to keep bond yields in check. Also, Tom believes we are in the middle of an important transition between growth and value; it feels more like a secular shift which we often see in a long bull market. We are 11 years in a bull market, which seems long, but past bull markets have been 19 to 20 years long, and there were shifts from growth to value in the middle of those, which is where he thinks we are positioned now.
Recorded March 12, 2021.