Equities will go higher in 2012 despite their
already record performance in Q1 2012, according to Skandia
Investment Group (SIG).
Global equities have had their strongest quarter in over 10
years on the back of strong economic data and hopes that the
European debt crisis was past its worst point.
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Following the sharp rally seen in recent months SIG reduced its
equity exposure at the end of March 2012 for fear profit takers
will take the edge off the market. However, the firm believes this
current weakness will be temporary and that equities will
strengthen later in the year.
SIG CIO James Millard said: “We remain positive on the outlook
for equities. However, we have slightly reduced the size of our
overweight position following the sharp gains seen over the last
few months. Economic data has become less positive while the
improvement in the peripheral bond markets appears to have
stalled.”
Millard added: “As a result of this, a bout of profit taking
could take place in the near term. Nonetheless, we think that
ongoing economic growth, low interest rates, favourable valuations
and an improvement in the Eurozone debt crisis will lead to higher
equities over the rest of 2012,” said Millard.
