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Yahoo
6 days ago
- Business
- Yahoo
Trump Tariffs Are Making International Stock Markets Great Again
(Bloomberg) -- US President Donald Trump's tariffs are giving international stocks a serious lift and at the same time helping to end the S&P 500 Index's run of global dominance — at least for now. All Hail the Humble Speed Hump Three Deaths Reported as NYC Legionnaires' Outbreak Spreads Mayor Asked to Explain $1.4 Billion of Wasted Johannesburg Funds Major Istanbul Projects Are Stalling as City Leaders Sit in Jail What England's New National Cycling Network Needs to Get Rolling International stock markets are on pace to outperform the broad US equities benchmark this year, the first time they've done that since 2022, and the first time in a rising market since 2009. Fears that tariffs and trade uncertainty will have an outsized impact on Corporate America's earnings growth are the primary culprit. The MSCI World Index excluding the US is clobbering the S&P 500 in 2025, jumping 18% thus far versus a more modest 7.8% gain in the S&P 500. You can see why in the individual performances. Mexico's key stock market index is up 18% this year, Canada's is up 12%, Germany's 21%, Spain's 26%, Brazil's 14%, and the UK's 11%. It's a sharp reversal from years of soaring gains for US equities, spurred most recently by mega-cap technology companies and the promise of artificial intelligence, and relatively sluggish performances by their global peers. This has left stocks in markets outside of the US relatively cheap. 'Sometimes the biggest gains come from the fixer-upper opportunities,' Craig Basinger, chief strategist at Purpose Investments Inc, said in an interview. The valuation gap between US and international markets is 'historically wide,' and investors are largely over-invested in the US and under-invested in other markets, according to Basinger. That trend has been reversing this year, and it could accelerate as Trump's tariffs come into effect this month, while trading partners in Canada, Europe, Japan and elsewhere embark on investor-friendly reforms and boost domestic growth, he said. 'Rate of change matters in markets, and it would appear that international markets, generally speaking, are becoming a bit more investor friendly,' Basinger said. 'America is still the gold standard, but if the gap narrows, so could the valuation gap.' An 'ultra-low growth' earnings outlook that has been baked into European and Japanese stocks for years also is starting to change, according to David Lambert, managing director, senior portfolio manager and head of European equities at RBC Global Asset Management. 'We're actually in an era now where earnings growth could be incrementally higher for the medium term,' Lambert said. 'There's no reason why you can't see a gentle rerating in the coming years even further from where we are today.' He's not alone in that opinion. A June survey by BofA Securities found that 54% of the fund managers who responded expect international stocks to be the best-performing asset in the next five years. Just 23% held that view on US equities. The reason is Trump's tariffs, which are expected to hit Corporate America's earnings harder than companies in Europe or Japan, said David Groman, a director on Citi Research's global equity strategy team. Europe in particular is leading in value and momentum performance, according to a Citi note to clients on Wednesday. 'There is more clarity and investors have this ability to at least pencil in what they think the earnings impact will be in a place like Europe or Japan,' Groman said in an interview. Markets like Europe have already priced in a bad outcome on tariffs, and it may actually turn out to be better than expected, he added. To be sure, some strategists see pain in the US potentially spilling over into other markets around the world. Emily Roland and Matthew Miskin, co-chief investment strategists at Manulife John Hancock, caution against holding low-quality, cyclical international stocks in this kind of environment. 'Every other time in history if the US sees a recession, it has brought the rest of the world down with it,' they wrote in a recent note to clients. Still, the rotation from US stocks and into international equities could end up being 'a very long' story, Purpose's Basinger said. 'People just have too much US right now,' he said. The Pizza Oven Startup With a Plan to Own Every Piece of the Pie Digital Nomads Are Transforming Medellín's Housing Russia's Secret War and the Plot to Kill a German CEO It's Only a Matter of Time Until Americans Pay for Trump's Tariffs The Game Starts at 8. The Robbery Starts at 8:01 ©2025 Bloomberg L.P.
Business Insider
02-07-2025
- Business
- Business Insider
Stocks are back near all-time highs. Here are 3 investing mistakes to avoid at the top.
Dear US investors, congratulations, you did it. After a first half of 2025 marked by tariff uncertainty, geopolitical turmoil, and a polarizing tax plan, major indexes are back near records. Now comes the hard part: making the right decisions to protect your equity nest egg. It's easier said than done. The assumption can be made that the path higher has been cleared. But the trio of forces that have been a drag on the market this year aren't gone. And for that reason caution is required. Detailed below are three common mistakes investors should avoid going forward. 1. Don't wait for a dip to buy more If you have cash to deploy, it's tempting to wait for a future dip instead of buying now. But investors who subscribe to this line of thinking are committing the classic mistake of trying to time the market. "That dip might never come, or the dip may come from an even higher place than we are right now," Clark Bellin, president and chief investment officer of Bellwether Wealth, told Business Insider. All-time highs aren't a rare occurrence, having happened more than 100 times in the last decade alone. And they're often followed by even more robust gains. For long-term investors, the timing of entry into the market has minimal impact. An analysis by RBC Global Asset Management shows that, since 1950, the S&P 500 has never ended a 10-year period more than 10% below any of its previous all-time highs. Some investors may be concerned about high valuations in the stock market, but that isn't always a bad thing. Richly priced stocks can also have strong underlying earnings and competitive advantages that offer compelling investing opportunities. At this specific moment in time, S&P 500 earnings revisions are on an encouraging upward trend, suggesting the stock market rally is backed by solid fundamentals. "In trying to wait for that perfect dip or moment, you may be waiting forever," Bellin said. 2. Don't buy based on FOMO Another tempting investing tactic is to buy into market hype and chase big winners that have already seen outsized gains. This can backfire. If a bunch of investors collectively pile into a specific stock or sector, it can lead to prices becoming overheated. Jumping in at these moments can leave investors exposed to sudden pullbacks or sharp corrections, especially if fundamentals don't support the elevated valuations. Bellin points to cryptocurrency as an asset class that is especially susceptible to this type of run-up. Investors tend to pile in as prices rise, but cryptocurrencies often experience sell-offs exceeding 50%. Putting in too much money all at once can be just as bad, if not worse, than sitting on the sidelines, especially if you're investing based on hype. Thanks to a psychological effect known as loss aversion, investors feel the pain of losing money far more intensely than the satisfaction of equivalent gains, leading to panic-selling and poor decision-making. The best strategy for investors is to have a regular investing schedule, said Jacqui Smith, portfolio manager at Reynders, McVeigh Capital Management. Dollar-cost averaging can smooth out the overall price you pay and reduce the impact of short-term volatility. Smith also recommends looking into quality companies with strong balance sheets to weather potential tariff concerns going into the future. 3. Don't forget to rebalance periodically Investors should also be mindful of their portfolio allocations, especially when markets are at all-time highs. For example, investors who own Nvidia might have seen a sizable return, meaning that the stock might be a much bigger part of their portfolio than it was a year ago. And with much of the gain in the S&P 500 driven by the Magnificent Seven, investors might not be aware of just how much AI exposure they have. "Investors should be very cognizant of inadvertently doubling down on AI by owning the S&P 500 and then owning Nvidia and other individual stocks on the side," Gary Quinzel, vice president of portfolio consulting at Wealth Enhancement, told Business Insider. He continued: "It could work for a short while and it could lead to outsized returns, but that's a prime example of knowing what you own." A well-diversified portfolio can insulate your money from market fluctuations, and the opposite is true for a more concentrated portfolio. All-time highs can be a good checkpoint to assess your risk tolerance, rebalance your holdings, and trim some names that have been big winners, Bellin said. If you've incurred losses in other areas of your portfolio, Bellin recommends investors look into tax-loss harvesting to help offset the tax effects of taking profits off the table.
Cision Canada
26-06-2025
- Business
- Cision Canada
RBC Global Asset Management Inc. announces RBC Target 2025 Education Fund maturity date, changes to RBC U.S. small-cap equity funds, and risk rating changes Français
TORONTO, June 26, 2025 /CNW/ - RBC Global Asset Management Inc. ("RBC GAM Inc.") today announced details regarding the maturity of RBC Target 2025 Education Fund, changes to RBC U.S. Small-Cap Core Equity Fund and RBC U.S. Small-Cap Value Equity Fund, and risk rating changes for certain RBC Funds. Maturity date of RBC Target 2025 Education Fund On or about November 21, 2025, RBC Target 2025 Education Fund will have reached its maturity date and RBC GAM Inc. will terminate it accordingly. All outstanding units of RBC Target 2025 Education Fund will be cancelled on the maturity date and unitholders will receive units of RBC Canadian Money Market Fund in exchange. Unitholders will be sent a written notice regarding the termination of RBC Target 2025 Education Fund. Changes to RBC U.S. Small-Cap Core Equity Fund and RBC U.S. Small-Cap Value Equity Fund RBC Global Asset Management will close its U.S. small-cap core, U.S. small-cap value, U.S. microcap core, and U.S. microcap value investment strategies managed by RBC Global Asset Management (U.S.) Inc. in Boston. This decision is intended to better align its product offerings with evolving industry dynamics and client needs. RBC GAM Inc. proposes to merge RBC U.S. Small-Cap Core Equity Fund and RBC U.S. Small-Cap Value Equity Fund (collectively, the "RBC U.S. Small-Cap Funds") into RBC U.S. Mid-Cap Value Equity Fund on or about November 21, 2025. These changes are subject to the approval of unitholders of the respective fund and other required approvals, including a positive recommendation from the Independent Review Committee of the RBC U.S. Small-Cap Funds. The proposed mergers are expected to be completed on a tax-deferred basis. Further details regarding the proposed mergers will be sent to unitholders of the RBC U.S. Small-Cap Funds in advance of the unitholder meeting. Effective July 14, 2025, the RBC U.S. Small-Cap Funds will no longer be available for purchase by new investors. Only existing unitholders of the RBC U.S. Small-Cap Funds on July 14, 2025, can continue to make additional investments into the funds. Risk rating changes The risk rating for certain RBC Funds has changed. These changes will be reflected in the applicable Fund Facts as part of the renewal of the simplified prospectus for RBC Funds, which is expected to be filed on or around June 27, 2025. These changes are based on the methodology mandated by the Canadian Securities Administrators to determine the risk level of mutual funds. RBC GAM Inc. reviews the risk rating for each fund on an annual basis, as well as when a fund undergoes a material change. These changes are the result of an annual review and not the result of any changes to the investment objectives, strategies or management of the funds. Risk rating increase Risk rating decrease Please consult your advisor and read the prospectus or Fund Facts or ETF Facts document before investing. There may be commissions, trailing commissions, management fees and expenses associated with mutual fund investments. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. RBC Funds, BlueBay Funds and PH&N Funds are offered by RBC GAM Inc. and distributed through authorized dealers in Canada. RBC GAM Inc. is a member of the RBC GAM group of companies and an indirect wholly owned subsidiary of Royal Bank of Canada. About RBC Royal Bank of Canada is a global financial institution with a purpose-driven, principles-led approach to delivering leading performance. Our success comes from the 97,000+ employees who leverage their imaginations and insights to bring our vision, values and strategy to life so we can help our clients thrive and communities prosper. As Canada's biggest bank and one of the largest in the world, based on market capitalization, we have a diversified business model with a focus on innovation and providing exceptional experiences to our more than 19 million clients in Canada, the U.S. and 27 other countries. Learn more at We are proud to support a broad range of community initiatives through donations, community investments and employee volunteer activities. See how at About RBC Global Asset Management RBC Global Asset Management (RBC GAM) is the asset management division of Royal Bank of Canada (RBC). RBC GAM is a provider of global investment management services and solutions to institutional, high-net-worth and individual investors through separate accounts, pooled funds, mutual funds, hedge funds, exchange-traded funds and specialty investment strategies. RBC Funds, BlueBay Funds, PH&N Funds and RBC ETFs are offered by RBC Global Asset Management Inc. (RBC GAM Inc.) and distributed through authorized dealers in Canada. The RBC GAM group of companies, which includes RBC GAM Inc. (including PH&N Institutional) and RBC Indigo Asset Management Inc., manage approximately $693 billion in assets and have approximately 1,600 employees located across Canada, the United States, Europe and Asia. SOURCE RBC Global Asset Management Inc.
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Business Standard
22-06-2025
- Business
- Business Standard
Central banks in Asia scale back currency intervention as dollar weakens
By Marcus Wong and Malavika Kaur Makol Some of emerging Asia's biggest central banks look to be dialing back their interventions in the currency market. The central banks of India and Malaysia have reduced the size of some derivatives positions they use to weaken their currencies. Taiwan has allowed its currency to surge against the dollar in recent weeks and dropped hints it would be comfortable with more if the moves were 'orderly.' South Korea's giant national pension fund has ended its five-month support of the won. A major reason for these moves is a simple change in the market landscape: The dollar has tumbled more than 7 per cent this year, easing pressure on emerging market currencies. But strategists and investors also point to the risk of a backlash from US President Donald Trump, amid rising speculation that currency policies will be on the table during a series of ongoing — and high stakes — trade negotiations. 'The threat of being labeled a currency manipulator by the US, especially during this period of tariff negotiations, will act as a deterrent to further heavy FX intervention in local markets,' said Rajeev De Mello, a Geneva-based portfolio manager at GAMA Asset Management SA. The shifting approach of Asia's central banks to defending their currencies underscores the sweeping changes in global markets since the election of Trump, whose on again-off again tariff threats have roiled asset prices and raised once unthinkable questions about the dollar's place in the global trading system. Korea confirmed last month that it had held currency talks with the US, sending the won higher amid talk that Trump wants a weaker dollar. But White House chief economist Stephen Miran has denied the idea Washington is working on secret deals to depreciate the greenback, saying the US continues to have a strong dollar policy. The greenback has plummeted against major currencies this year, suffering drops of around 10 per cent against the euro and the Swiss franc. Best bets Traders are now trying to game out which currencies have the most to gain from a period of reduced intervention. The Korean won and the Malaysian ringgit are two obvious candidates, since both countries have large trade surpluses, said Gautam Kalani, portfolio manager for BlueBay fixed income, emerging markets, at RBC Global Asset Management. Reduced intervention will speed up the appreciation of these currencies, he said. The Taiwan dollar is also being hotly tipped by strategists. Although Taiwan's central bank is still likely to use intervention to keep volatility in check, most market participants think it will allow the local currency to appreciate further even after hitting multi-year highs. That suggests room to build on what has already been a widespread rally against the dollar: Taiwan's currency has surged 11 per cent against the greenback this year, making it the region's best performer. The Korean won is up almost 8 per cent, while the Malaysian ringgit is around 5 per cent higher. The retreat from intervention isn't unanimous across Asia. Bank Indonesia pushed back against volatility on Thursday as Middle East tensions hit emerging market currencies. The Philippines' central bank has sent mixed messages, calling intervention futile but also saying it might have to do so 'more seriously' if a current slide in the peso continues. The People's Bank of China continues to keep its currency under a tight leash. But for some of emerging Asia's most interventionist central banks, the calculus appears to have shifted in favor of a less hands-on approach. The US Treasury refrained from labeling any country a currency manipulator in its latest foreign-exchange report, released in June. However, it said China, Japan, South Korea, Taiwan, Singapore and Vietnam all met two out of three of its criteria.
Time of India
20-06-2025
- Business
- Time of India
Oil, war and tariffs tear up markets' central bank roadmap
Investor unease about an increasingly uncertain environment is rising, as Norway's shock rate cut on Thursday highlights how US tariffs, Middle East conflict and a shaky dollar make global monetary policy and inflation even harder to predict. Norway's crown slid roughly 1 per cent against the dollar and the euro in a sign of how unexpected the move was. And Switzerland, which cut borrowing costs to 0 per cent on Thursday, confounded some expectations among traders for a return to negative rates in the deflation-hit nation, as its central bank warned of a cloudy global outlook. Just a day earlier the US Federal Reserve kept rates on hold and chair Jerome Powell said "no one" had conviction on the rate path ahead. The conclusion for markets: monetary policy uncertainty is one more headwind to navigate against a backdrop of geopolitical and trade risks. Global stocks pulled away from recent peaks, a gauge of expected volatility in European equities touched a two-month high as stocks across the region fell and government bonds, usually geopolitical risk havens, sold off. "We're at a moment of considerable policy and macro uncertainty," said BlueBay chief investment officer at RBC Global Asset Management Mark Dowding. "We can't see a clear trend on interest rates," he added, which meant he was holding back from active market bets across the group's investment portfolios. Volatility was set to rise, some investors said, because a choppy dollar and oil prices whipped around by geopolitics meant that central banks were far less able to provide markets and investors a clear route map for the future. "You cannot just take your cues from the central banks anymore as they are facing a harder job of reading the economy themselves," T.S. Lombard director of European and global macro Davide Oneglia said. Broken models Rate-cutting European central banks are not just diverging from the Fed, which is grappling with the inflationary risks of President Donald Trump's tariffs. They are also struggling to navigate a new era where the dollar, the lynchpin of world trade, commodity prices and asset valuations, has turned weaker and more volatile under trade war stress and government debt anxiety. "That's a massive, massive fundamental shift in global markets that everyone is trying to assess," Monex Europe head of Macro Research Nick Rees said. "All of those standard economic rules of thumb we use for forecasting are completely broken right now." The dollar is down almost 9 per cent against other major currencies this year but has risen following the outbreak of a war between Israel and Iran. European Central Bank policymaker Francois Villeroy de Galhau said on Thursday the ECB might have to adapt its rate cut plans if oil price volatility was long-lasting. The new status quo in markets could well be an era of central bank surprises that create rapid shifts in the market narrative, asset pricing and volatility trends, analysts said. "We're getting into this next cycle in which variables are much more volatile, because, rather than (monetary policy) being just easily predictable, events just take over and policy and human factors, as we now know with Donald Trump, play an important role," Oneglia said. Norway's surprise cut came because the crown was a "runaway top currency" of the trade-war era, added Societe Generale's head of FX strategy Kit Juckes. With investors chasing around the world to identify stores of wealth that are not US dollars, meanwhile, the Swiss franc has soared, cutting the costs of imports and pushing the economy into deflation. On Thursday, the franc rose against the dollar as traders saw the SNB's cut as too small to keep deflation at bay. Ninety One multi-asset head John Stopford said the hazard risk was rising for global stocks and that options products that aim to offer protection from incoming volatility looked fairly cheap. He was buying bonds issued in nations where inflation and rates could come down materially, such as New Zealand, but was negative on longer-dated US Treasuries and German Bunds where economic uncertainty was higher and government borrowing was likely to rise. Global stocks remain almost 20 per cent above their April trough, after investors relaxed about tariffs. Stopford said there was more to worry about in the short term. "The stock market feels like it's a thatched house in a hot country with a fire hazard risk, and people aren't charging much to insure the house," Stopford added.
