Here’s what’s happening in our flagship portfolios:
- As mentioned above, we are at the midst of the earnings season. We want to use this opportunity to highlight a few companies we hold in portfolios that have reported robust results in the past week. Going into the quarter there was some apprehension about Big Tech. However, these concerns have been unfounded so far, as Alphabet, Amazon and Microsoft all delivered strong results. Out of the three, Microsoft stood out as their cloud business Azure continued to grow strongly. In the healthcare sector, Thermo Fisher’s results were slightly ahead of expectations with management reiterating guidance for 2023, unlike the recent disappointments from some of its peers.
- Looking ahead, although market confidence has improved this year, we maintain a slightly cautious near-term macroeconomic and market view due to recession risks we see ahead and an uncertain corporate earnings outlook. In addition, as economies enter the late stage of the market cycle, risks of heightened volatility tend to increase.
- As a result, we maintain our current near-term strategy of:
- a below-normal equity exposure and above-normal fixed income exposure,
- a bias towards quality investments within equities, and
- a preference for developed market government bonds over riskier bonds within fixed income.
Past performance is not a reliable indicator of future returns.