Holly Newman Kroft, Senior Wealth Advisor, recently joined CNBC's "Squawk on the Street" to talk through what's driving markets right now, and there's plenty to sort through.
Signals point to a likely Fed rate hike this week as policymakers continue working to bring inflation down, with the European Central Bank having already raised rates last week. Oil prices are adding to inflationary pressures, while the 10-year yield has continued to grind higher as markets price in a higher-for-longer rate environment. Even so, the market has largely held its ground. Q1 and Q2 earnings generally surprised to the upside, and analysts have responded by revising next year's estimates even higher, a sign this strength has some grounding in fundamentals.
Heading into year end, Holly cautions volatility could pick up, with geopolitical tension, oil prices, midterm elections, and higher rates all at play. Still, she draws a distinction between volatility and vulnerability. Strong corporate earnings and generally healthy balance sheets may give this market continued room to run, even as the noise around it builds. The takeaway is one of measured confidence: the fundamentals underpinning this market appear strong enough to withstand near-term turbulence, reinforcing the case for staying invested and focused on the long term.
Watch the full segment for Holly's complete take, including a closer look at how she's positioning portfolios.
IMPORTANT INFORMATION:
Third-party media content is being redistributed with permission and may not be redistributed without the publisher's consent. This material is presented solely for informational purposes and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment or strategy is suitable for a particular investor. Any views or opinions expressed may not reflect those of the firm as a whole. All information is current as of the date of this material, unless otherwise noted, and is subject to change without notice. Neuberger Berman products and services may not be available in all jurisdictions or to all client types. Diversification does not guarantee profit or protect against loss in declining markets. Investing entails risks, including possible loss of principal. Past performance is no guarantee of future results.
Portfolio positioning views expressed herein may include those of Neuberger Asset Allocation Committee, Neuberger’s Wealth Investment Group or individual Neuberger Wealth advisors. Asset allocation and positioning views are based on a hypothetical reference portfolio. The positioning views of the Asset Allocation Committee, the Wealth Investment Group and Wealth advisors may not reflect the views of the firm as a whole and Neuberger Wealth advisors and portfolio managers may take contrary positions to the views expressed. The Asset Allocation Committee, Wealth Investment Group or Wealth advisor views do not constitute a prediction or projection of future events or future market behavior. Defensive positioning generally means an underweight bias on allocations to risk assets such as equities and alternatives. Positioning views may change over time without notice and actual client positioning may vary significantly. Discussion of yield characteristics or total returns of different asset classes are for illustrative purposes only. Asset classes such as equities and fixed income may have significantly different overall risk-return characteristics, which should be considered before investing. Client accounts are individually managed and may vary significantly from portfolio positioning views discussed. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable.
The information in this material may contain projections, market outlooks or other forward-looking statements regarding future events, including economic, asset class and market outlooks or expectations, and is only current as of the date indicated. There is no assurance that such events, outlook and expectations will be achieved, and actual results may be significantly different than that shown here.
Neuberger Berman Investment Advisers LLC is a registered investment adviser. The “Neuberger” name and logos are service marks of Neuberger Berman Group LLC.