Capital Market Outlook
July 10, 2023
IN THIS ISSUE
- Macro Strategy — Message in the Yield Curve: The front of the yield curve has steepened, putting more strains on the economy.
- Market View — 2023: A Midyear Market Assessment: We review what has been a strong start to the year for global Equity markets and identify some of the key trends that could determine market direction going into the second half.
- Thought of the Week — Who's Hiring?: We continue to expect job growth to slow in the back half of the year as a deteriorating profits cycle forces firms to take more aggressive cost-cutting measures to support margins.
Opinions and data are as of the date of this report and are subject to change.
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The Chief Investment Office (CIO) provides thought leadership on wealth management, investment strategy and global markets; portfolio management solutions; due diligence; and solutions oversight and data analytics. CIO viewpoints are developed for Bank of America Private Bank, a division of Bank of America, N.A., (“Bank of America") and Merrill Lynch, Pierce, Fenner & Smith Incorporated (“MLPF&S" or “Merrill"), a registered broker-dealer, registered investment adviser and a wholly owned subsidiary of Bank of America Corporation (“BofA Corp.").
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Asset allocation, diversification and rebalancing do not ensure a profit or protect against loss in declining markets.
Investments have varying degrees of risk. Some of the risks involved with equity securities include the possibility that the value of the stocks may fluctuate in response to events specific to the companies or markets, as well as economic, political or social events in the U.S. or abroad. Bonds are subject to interest rate, inflation and credit risks. Treasury bills are less volatile than longer-term fixed income securities and are guaranteed as to timely payment of principal and interest by the U.S. government. Investments in foreign securities (including ADRs) involve special risks, including foreign currency risk and the possibility of substantial volatility due to adverse political, economic or other developments. These risks are magnified for investments made in emerging markets. Investments in a certain industry or sector may pose additional risk due to lack of diversification and sector concentration.