Latest news with #CoreData
Zawya
4 days ago
- Business
- Zawya
Never mind Wall Street records, investors rethink US market supremacy
NEW YORK - A rebound on Wall Street and in the dollar has not allayed investor concerns about the ability of U.S. assets to outperform overseas markets, with a fresh tariff salvo once again denting market optimism after a string of trade deals struck by the Trump administration perked up sentiment for equities to set record highs. The sliding dollar, down about 8% this year against a basket of major currencies, and the ballooning fiscal deficit are shaking the conviction that U.S. financial markets will deliver world-beating returns. For more than a decade, the concept of "American exceptionalism" - the conviction that the United States' democratic system plus its huge and liquid capital markets offer unique rewards - has been little challenged by investors. But ongoing uncertainty surrounding tariffs is rattling confidence. While the deals struck by Donald Trump with the European Union, Japan and South Korea have delivered some relief, the U.S. president late on Thursday slapped dozens of trading partners with steep tariffs. A market shakeout earlier this year caused by Trump's first tariff announcements triggered a re-evaluation. The U.S. market's standing appears "a little bit bruised," said Lori Heinel, global chief investment officer at State Street Investment Management. "The overhang of the (government) debt makes it less attractive to have dollar-based assets," she added. In a survey conducted in late May and June, market research consultancy CoreData found that many institutional investors and consultants, collectively overseeing $4.9 trillion in assets, are scaling back exposure to the U.S. Among respondents, 47% are cutting their strategic, long-term allocations to U.S. markets. While investors have become more upbeat on the outlook for Europe, as well as for China and other emerging markets, bullishness toward U.S. markets now lags those regions. That, said Michael Morley, head of CoreData US, marks 'a massive reversal' from attitudes two years ago. The latest wave of tariffs on exports from dozens of trading partners, including Canada, Brazil, India and Taiwan, sent global markets tumbling on Friday. The announced duties were "somewhat worse than expected," analysts at Societe Generale said in a note. "Markets responded more negatively to the August 1 announcement than to other news in the past two months, but the reaction was far less severe than on April 2," they said. TARIFF IMPACT OVERDUE? Investors began reconsidering their allocations following Trump's "Liberation Day" tariff announcement on April 2, reassessing the allure of "brand USA" and fretting about a new recession. The Trump administration then paused tariff rollouts and subsequently began announcing deals that cap tariffs at lower levels than initially proposed. Stocks rebounded, with the S&P 500 soaring 27.2% from its April 8 close to its July 31 close, setting a series of new records. CoreData, however, found that 49% of institutions believe that markets now are too complacent about the impact of U.S. tariffs. U.S. consumer prices increased by the most in five months in June, according to Consumer Price Index data, suggesting that tariffs are boosting inflation. Other data points to a moderation in economic activity, and second-quarter growth was mainly strong because imports were weak. Global asset manager Man Group, which manages roughly $193 billion, is wary of overweighting U.S. assets. 'This is an opportunity for investors to take some profits, rebalance and go to neutral on the U.S.," said Kristina Hooper, chief market strategist at Man Group. BEYOND TARIFFS The dollar's status as the global reserve currency may be in question as the U.S. forfeits the role of free trade facilitator, said Thierry Wizman, global FX and rates strategist at Macquarie Group, adding the firm expects to sell the dollar on any rally. After suffering its worst first-half performance since 1973 this year, the dollar posted its first monthly gains for 2025 in July, as investors regained confidence in the wake of trade deals. Also contributing to the reassessment of U.S. market supremacy is the risk of monetary policy being politicized. Trump has repeatedly called for lower interest rates and threatened to remove Federal Reserve Chair Jerome Powell. A recently approved tax and spending bill, meanwhile, will add trillions to the government's debt, exacerbating longstanding deficit concerns. Investors are likely to respond by seeking higher compensation for the risk of owning long-dated Treasury securities "There's very, very real risk that yields go significantly higher because of the deficit," said Man Group's Hooper. U.S. INNOVATION For many, the buoyant U.S. stock market and optimism surrounding the U.S. tech sector have made it hard to turn bearish. "The bottom line is that the U.S. has some of the most innovative and profitable companies in the world, and the deepest capital markets," said Kelly Kowalski, head of investment strategy at MassMutual. Anxiety about the demise of U.S. pre-eminence is "overblown," she said. Concerns over weaker foreign demand for U.S. debt have eased in recent weeks. After selling a net $40.8 billion of Treasuries in April, foreigners resumed buying to the tune of $146 billion in May, the latest government data showed. Also, while European stocks handily beat their U.S. counterparts in March, that gap has narrowed with every new trade deal announced. As of the end of July, Europe's STOXX 600 was roughly neck and neck with the S&P 500. "The big factor in the room has nothing to do with policies, but technology," said Richard Lightburn, deputy chief investment officer at macro hedge fund MKP Capital Management. "It still feels like early innings for AI adoption and integration." Anthony Saglimbene, chief market strategist at Ameriprise Financial, continues to recommend a slight overweight to U.S. stocks relative to other global markets. "Call it 'exceptionalism' or just 'clarity.' The macro environment in the U.S. is comparatively more stable." (Reporting by Carolina Mandl and Davide Barbuscia in New York and Suzanne McGee in Providence, Rhode Island; Additional reporting by Laura Matthews in New York; Editing by Alden Bentley and Matthew Lewis and Chizu Nomiyama)
Khaleej Times
4 days ago
- Business
- Khaleej Times
Never mind Wall Street records, investors rethink US market supremacy
A rebound on Wall Street and in the dollar has not allayed investor concerns about the ability of U.S. assets to outperform overseas markets, with a fresh tariff salvo once again denting market optimism after a string of trade deals struck by the Trump administration perked up sentiment for equities to set record highs. The sliding dollar, down about 8% this year against a basket of major currencies, and the ballooning fiscal deficit are shaking the conviction that U.S. financial markets will deliver world-beating returns. For more than a decade, the concept of "American exceptionalism" - the conviction that the United States' democratic system plus its huge and liquid capital markets offer unique rewards - has been little challenged by investors. But ongoing uncertainty surrounding tariffs is rattling confidence. While the deals struck by Donald Trump with the European Union, Japan and South Korea have delivered some relief, the U.S. president late on Thursday slapped dozens of trading partners with steep tariffs. A market shakeout earlier this year caused by Trump's first tariff announcements triggered a re-evaluation. The U.S. market's standing appears "a little bit bruised," said Lori Heinel, global chief investment officer at State Street Investment Management. "The overhang of the (government) debt makes it less attractive to have dollar-based assets," she added. In a survey conducted in late May and June, market research consultancy CoreData found that many institutional investors and consultants, collectively overseeing $4.9 trillion in assets, are scaling back exposure to the U.S. Among respondents, 47% are cutting their strategic, long-term allocations to U.S. markets. While investors have become more upbeat on the outlook for Europe, as well as for China and other emerging markets, bullishness toward U.S. markets now lags those regions. That, said Michael Morley, head of CoreData US, marks 'a massive reversal' from attitudes two years ago. The latest wave of tariffs on exports from dozens of trading partners, including Canada, Brazil, India and Taiwan, sent global markets tumbling on Friday. The announced duties were "somewhat worse than expected," analysts at Societe Generale said in a note. "Markets responded more negatively to the August 1 announcement than to other news in the past two months, but the reaction was far less severe than on April 2," they said. TARIFF IMPACT OVERDUE? Investors began reconsidering their allocations following Trump's "Liberation Day" tariff announcement on April 2, reassessing the allure of "brand USA" and fretting about a new recession. The Trump administration then paused tariff rollouts and subsequently began announcing deals that cap tariffs at lower levels than initially proposed. Stocks rebounded, with the SP 500 soaring 27.2% from its April 8 close to its July 31 close, setting a series of new records. CoreData, however, found that 49% of institutions believe that markets now are too complacent about the impact of U.S. tariffs. U.S. consumer prices increased by the most in five months in June, according to Consumer Price Index data, suggesting that tariffs are boosting inflation. Other data points to a moderation in economic activity, and second-quarter growth was mainly strong because imports were weak. Global asset manager Man Group, which manages roughly $193 billion, is wary of overweighting U.S. assets. 'This is an opportunity for investors to take some profits, rebalance and go to neutral on the U.S.," said Kristina Hooper, chief market strategist at Man Group. Beyond tariffs The dollar's status as the global reserve currency may be in question as the U.S. forfeits the role of free trade facilitator, said Thierry Wizman, global FX and rates strategist at Macquarie Group, adding the firm expects to sell the dollar on any rally. After suffering its worst first-half performance since 1973 this year, the dollar posted its first monthly gains for 2025 in July, as investors regained confidence in the wake of trade deals. Also contributing to the reassessment of U.S. market supremacy is the risk of monetary policy being politicized. Trump has repeatedly called for lower interest rates and threatened to remove Federal Reserve Chair Jerome Powell. A recently approved tax and spending bill, meanwhile, will add trillions to the government's debt, exacerbating longstanding deficit concerns. Investors are likely to respond by seeking higher compensation for the risk of owning long-dated Treasury securities "There's very, very real risk that yields go significantly higher because of the deficit," said Man Group's Hooper. For many, the buoyant U.S. stock market and optimism surrounding the U.S. tech sector have made it hard to turn bearish. "The bottom line is that the U.S. has some of the most innovative and profitable companies in the world, and the deepest capital markets," said Kelly Kowalski, head of investment strategy at MassMutual. Anxiety about the demise of U.S. pre-eminence is "overblown," she said. Concerns over weaker foreign demand for U.S. debt have eased in recent weeks. After selling a net $40.8 billion of Treasuries in April, foreigners resumed buying to the tune of $146 billion in May, the latest government data showed. Also, while European stocks handily beat their U.S. counterparts in March, that gap has narrowed with every new trade deal announced. As of the end of July, Europe's STOXX 600 was roughly neck and neck with the SP 500. "The big factor in the room has nothing to do with policies, but technology," said Richard Lightburn, deputy chief investment officer at macro hedge fund MKP Capital Management. "It still feels like early innings for AI adoption and integration." Anthony Saglimbene, chief market strategist at Ameriprise Financial, continues to recommend a slight overweight to U.S. stocks relative to other global markets. "Call it 'exceptionalism' or just 'clarity.' The macro environment in the U.S. is comparatively more stable."
Yahoo
29-07-2025
- Business
- Yahoo
Institutional Investors Say Markets Are Underestimating Tariff Impact; Many Pull Back on U.S. Stocks, Finds CoreData Research
Nearly eight in 10 institutional investors are making tactical or longer-term strategic shifts in the face of volatile U.S. trade policy. Seven in 10 worry that tariff policies will accelerate a global shift away from treasuries and the U.S. dollar. A third think the U.S. and China will fail to make a deal and reinstate trade barriers that will unleash major economic disruption. Nearly half think the markets are too complacent about tariff impacts. U.S. stocks are widely expected to underperform compared to other markets. BOSTON, July 29, 2025--(BUSINESS WIRE)--Institutional investors are revamping portfolios through tactical tweaks and strategic shifts as they brace for heightened turbulence triggered by volatile U.S. trade policy, according to new survey data from CoreData Research. CoreData conducted a pulse survey of 132 institutional investors and 22 institutional consultants who collectively manage or oversee more than $4.9 trillion in assets. Nearly half (49%) of respondents believe the markets are too complacent about the impact of U.S. trade policies. While the S&P 500 has stormed back from its initial freefall in April, 56% of institutions hold a bearish view on U.S. equity markets over the next three months – the most pessimistic outlook of all regional equity markets. As early tariff moves begin to bite, CoreData found that institutional investors aren't waiting around for more clarity to act. Nearly half (49%) have already made tactical portfolio changes in response to shifting U.S. trade policies, and 47% have or plan to make changes in their strategic allocations. European and Asian institutions have been more inclined to take action, with more than half already making significant portfolio changes compared to just 36% of U.S. institutions so far. In the case of Europe, this may be because European institutions are more bearish (65%) in their near-term outlook for U.S. equity markets than peers in the U.S. (49%). When asked about their base case for the outcome of President Trump's trade policy negotiations with China, the survey found: 66% of respondents are optimistic that a U.S. China trade agreement will be reached within the next year, limiting market disruption. U.S. investors (69%) are more optimistic than peers in Europe (58%). 32% overall believe the U.S. and China will not be able to reach a trade agreement and will reinstate trade barriers that lead to significant economic disruption. "The research suggests that any optimism institutional investors have about the world's most important trade negotiations belies a sense that global trade already has irrevocably changed, and thus, portfolio construction must adapt to a new reality," said Michael Morley, head of CoreData U.S. "With a wide range of economic scenarios now very much in play, institutions are looking at ways to de-risk and build greater portfolio resilience." Tactical Shifts Point to Proactive Risk Mitigation Among investors making tactical adjustments 56% have reduced exposure to U.S. assets, including 48% of U.S. institutions and 63% in Europe. 49% have trimmed exposure to trade-sensitive assets. 44% are hedging exposure to the U.S. dollar, including 32% of U.S. institutions and 47% in Europe. Other tactical changes include rotating to value stocks and/or defensive sectors (41%) or increasing cash allocations (40%). Few (20%) reported increasing commodities exposure. Long-Term Strategic Repositioning Underway The long-term picture also points to a reduction in U.S. exposures as other developed markets suddenly look much more attractive. Notably, the survey found: 69% of institutions believe evolving tariff policies will accelerate a global shift away from treasuries and the U.S. dollar, including 59% in the U.S. and 82% in Europe. Indeed, 51% of those making strategic allocation shifts are pivoting away from these safe haven assets (highest among European institutions, 69% compared to 33% in the U.S.). 64% expect President Trump's trade policies will lead to structurally higher inflation and slower economic growth. 62% believe that sustained downward pressure on the dollar would lead to transformative change to the financial system, forcing institutions into more significant portfolio changes. About one-third (33%) are shifting to a more conservative asset allocation, increasing exposure to hedge funds/low volatility strategies (35%), or increasing exposure to inflation-hedging assets (32%) such as real assets. "Institutions are demonstrating a much nimbler reaction function than we have seen in the past with respect to strategic allocation changes," added Morley. "Ex-U.S. developed markets and dollar and treasury alternatives are set to be the main beneficiaries. Trump's initial tariffs have done little damage to date, but investors are clearly worried about the long-term impacts." More insights from CoreData can be found at Methodology The 2025 CoreData Institutional Investor Pulse Survey is based on responses from 154 global institutional investors collected in Q2 2025. Respondents include public and private pensions, insurers, foundations, endowments, family offices, and institutional investment consultants. About CoreData Research CoreData Research is a global research firm providing research-driven insights on the priorities and challenges facing financial institutions, advisors and influencers. CoreData's deep understanding of the broad financial services market is driven by world-class research capabilities and a global network of partners with a focus on fund management, wealth management, asset allocators, thought leadership and brand. Founded in 2002, CoreData has offices throughout Europe, the Americas and Asia-Pacific, with its U.S. headquarters in Boston. For more about CoreData, visit View source version on Contacts Media contactJared 617-702-3392 Sign in to access your portfolio
Business Wire
29-07-2025
- Business
- Business Wire
Institutional Investors Say Markets Are Underestimating Tariff Impact; Many Pull Back on U.S. Stocks, Finds CoreData Research
BOSTON--(BUSINESS WIRE)--Institutional investors are revamping portfolios through tactical tweaks and strategic shifts as they brace for heightened turbulence triggered by volatile U.S. trade policy, according to new survey data from CoreData Research. "Any optimism institutional investors have about the world's most important trade negotiations belies a sense that global trade already has irrevocably changed, and thus, portfolio construction must adapt to a new reality.' Share CoreData conducted a pulse survey of 132 institutional investors and 22 institutional consultants who collectively manage or oversee more than $4.9 trillion in assets. Nearly half (49%) of respondents believe the markets are too complacent about the impact of U.S. trade policies. While the S&P 500 has stormed back from its initial freefall in April, 56% of institutions hold a bearish view on U.S. equity markets over the next three months – the most pessimistic outlook of all regional equity markets. As early tariff moves begin to bite, CoreData found that institutional investors aren't waiting around for more clarity to act. Nearly half (49%) have already made tactical portfolio changes in response to shifting U.S. trade policies, and 47% have or plan to make changes in their strategic allocations. European and Asian institutions have been more inclined to take action, with more than half already making significant portfolio changes compared to just 36% of U.S. institutions so far. In the case of Europe, this may be because European institutions are more bearish (65%) in their near-term outlook for U.S. equity markets than peers in the U.S. (49%). When asked about their base case for the outcome of President Trump's trade policy negotiations with China, the survey found: 66% of respondents are optimistic that a U.S. China trade agreement will be reached within the next year, limiting market disruption. U.S. investors (69%) are more optimistic than peers in Europe (58%). 32% overall believe the U.S. and China will not be able to reach a trade agreement and will reinstate trade barriers that lead to significant economic disruption. 'The research suggests that any optimism institutional investors have about the world's most important trade negotiations belies a sense that global trade already has irrevocably changed, and thus, portfolio construction must adapt to a new reality,' said Michael Morley, head of CoreData U.S. 'With a wide range of economic scenarios now very much in play, institutions are looking at ways to de-risk and build greater portfolio resilience.' Tactical Shifts Point to Proactive Risk Mitigation Among investors making tactical adjustments 56% have reduced exposure to U.S. assets, including 48% of U.S. institutions and 63% in Europe. 49% have trimmed exposure to trade-sensitive assets. 44% are hedging exposure to the U.S. dollar, including 32% of U.S. institutions and 47% in Europe. Other tactical changes include rotating to value stocks and/or defensive sectors (41%) or increasing cash allocations (40%). Few (20%) reported increasing commodities exposure. Long-Term Strategic Repositioning Underway The long-term picture also points to a reduction in U.S. exposures as other developed markets suddenly look much more attractive. Notably, the survey found: 69% of institutions believe evolving tariff policies will accelerate a global shift away from treasuries and the U.S. dollar, including 59% in the U.S. and 82% in Europe. Indeed, 51% of those making strategic allocation shifts are pivoting away from these safe haven assets (highest among European institutions, 69% compared to 33% in the U.S.). 64% expect President Trump's trade policies will lead to structurally higher inflation and slower economic growth. 62% believe that sustained downward pressure on the dollar would lead to transformative change to the financial system, forcing institutions into more significant portfolio changes. About one-third (33%) are shifting to a more conservative asset allocation, increasing exposure to hedge funds/low volatility strategies (35%), or increasing exposure to inflation-hedging assets (32%) such as real assets. 'Institutions are demonstrating a much nimbler reaction function than we have seen in the past with respect to strategic allocation changes,' added Morley. 'Ex-U.S. developed markets and dollar and treasury alternatives are set to be the main beneficiaries. Trump's initial tariffs have done little damage to date, but investors are clearly worried about the long-term impacts.' More insights from CoreData can be found at Methodology The 2025 CoreData Institutional Investor Pulse Survey is based on responses from 154 global institutional investors collected in Q2 2025. Respondents include public and private pensions, insurers, foundations, endowments, family offices, and institutional investment consultants. About CoreData Research CoreData Research is a global research firm providing research-driven insights on the priorities and challenges facing financial institutions, advisors and influencers. CoreData's deep understanding of the broad financial services market is driven by world-class research capabilities and a global network of partners with a focus on fund management, wealth management, asset allocators, thought leadership and brand. Founded in 2002, CoreData has offices throughout Europe, the Americas and Asia-Pacific, with its U.S. headquarters in Boston. For more about CoreData, visit
News.com.au
28-04-2025
- Business
- News.com.au
How lowering mortgage buffer could help 400,000 young Australians buy homes
Lowering the mortgage stress test by just half a per cent could help almost 400,000 young Australians finally get a foot on the property housing ladder. New Finance Brokers Association of Australia research revealed reducing the serviceability buffer from 3 per cent to 2.5 per cent would boost borrowing capacity and allow thousands of would-be homeowners to qualify for a loan. It comes as first-home buyers continue to battle soaring house prices, tougher lending rules and limited housing supply. FBAA managing director Peter White said it was a simple move that could make a life-changing difference. 'These are people who can afford the repayments, but they're being unfairly locked out by an unrealistic system,' Mr White said. CoreData modelling found the tweak would lift national borrowing power by 5 per cent and unlock an extra $276bn in loan capacity. Around 270,000 more Australians would qualify for a median home loan, with almost 400,000 first-home buyers aged 25 to 34 among the biggest winners. Buyers agent Cate Bakos said the 3 per cent buffer was a hangover from the era of emergency interest rates, and was now doing more harm than good. 'Dropping the buffer by just half a per cent would put better homes within reach,' Ms Bakos said. 'It could be the difference between buying a one-bedroom apartment or a two-bedroom unit, or getting into a better suburb closer to work and family.' She said the Melbourne $600,000 to $900,000 market, where many first-home buyers operate, remained 'relatively soft' — giving young buyers a rare opportunity to purchase without fierce competition. However, independent property economist Cameron Kusher warned the policy could have unintended consequences. 'It would definitely help first-home buyers in the short term,' Mr Kusher said. 'But if you boost borrowing capacity, you inevitably boost prices too, and that could make it even harder for the next group trying to get in.' Mr Kusher said while a 5 per cent lift in borrowing power was meaningful for buyers on the cusp, it would not fundamentally reshape the market. He said the real solution to housing affordability was unlocking more supply, not just tweaking lending rules. Both Ms Bakos and Mr Kusher said the serviceability buffer should be reviewed regularly to reflect changing economic conditions, rather than staying at emergency settings indefinitely. The FBAA has urged both major parties to commit to a review of the buffer ahead of the federal election.
