Capital Market Outlook
May 5, 2025
IN THIS ISSUE
- Macro Strategy — The Inconvenient Truth: The Reordering of Global Trade — While Painful — is Long Overdue: In this environment, the most adaptable companies should thrive–as should nimble investors. The global reordering of trade is on.
- Market View — The Price of Admission: The Fee for the First 100 Days: On an absolute basis, U.S. economic growth is contracting, while on a relative basis, overseas growth prospects are picking up, and so growth differentials globally have narrowed. All this together makes for a shift in the risk premium for investors.
- Thought of the Week — Sell in May?: With May upon us, investors may start to hear the old saying: “Sell in May and go away." The adage refers to a seasonal market-timing strategy to sell stocks in the summer months and reinvest again in the fall. Looking at history, however, this seasonal pattern has not always held up.
Important Disclosures
Opinions and data are as of the date of this report and are subject to change.
Investing involves risk, including the possible loss of principal. Past performance is no guarantee of future results.
This information should not be construed as investment advice and is subject to change. It is provided for informational purposes only and is not intended to be either a specific offer by Bank of America, Merrill or any affiliate to sell or provide, or a specific invitation for a consumer to apply for, any particular retail financial product or service that may be available.
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.").
All recommendations must be considered in the context of an individual investor’s goals, time horizon, liquidity needs and risk tolerance. Not all recommendations will be in the best interest of all investors.
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.
