Claudia Raoul, fund manager-analyst, Invesco, has suggested investors should keep an eye on volatility levels in light of ongoing questions around macroeconomic indicators.
"After the very strong first quarter of the year, volatility is again close to an all-time low. Equities are up by two digits and stocks have rerated compared to the last quarter of 2018," she notes.
"Macroeconomic indicators and global GDP are pointing towards a growth deceleration and geopolitics continue to be uncertain. But central banks continue to support the markets."
"Given this context and the coming earnings session, we could expect volatility to pick up, but probably less at an index level and more at a sector and stock level. Cyclical stocks will potentially be under pressure. In our portfolios, we stay tactically active on sector allocation".
Claudia Raoul is a fund manager-analyst at Invesco in Paris
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