S&W The Pulse

In this episode we discuss the growing attractiveness of non-US markets and large US technology stocks.Much of the recent rally has been led by the US market and large technology stocks in particular. While the crisis has created significant demand for video conferencing, social media and e-commerce, the rise in market value for many technology stocks has far exceeded their increase in profits.At the same time, big tech faces some political risk from the US election in November, with the potential for a regulatory backlash should the Democrats win a clean sweep. Any corporate tax hikes could also knock earnings. As such, the outlook for US stocks is less appealing. In this month’s Investment Show, we discuss why we are seeing greater opportunities outside the US. We believe emerging markets may be poised for a stronger run, benefiting from a weaker Dollar and lower valuations.  Sources:Refinitiv Datastream, data as at 31 July 2020Have Equities Become A Bubble?, Gavekal, 10 July 2020Refinitiv Datastream, data