Top of main content

Investment Monthly: Market optimism on prospect of rate cuts and profit growth

1 June 2024

Willem Sels

Global Chief Investment Officer, HSBC Global Private Banking and Wealth

Lucia Ku 

Global Head of Wealth Insights, HSBC Wealth and Personal Banking

Key takeaways

  • April’s improved US inflation data and a less hawkish Fed tone suggest that a Fed rate cut is likely in September. While the ECB should be on track to cut rates in June, we have shifted our expectation for the BoE to start in August. As the bond yield peak is likely behind us, we continue to lock in current yields from quality bonds, such as Treasuries and investment grade bonds. 
  • While strong earnings growth continues to add momentum in the US and technology, we have been broadening our geographical and sector exposure thanks to global cyclical and rate tailwinds. Amid mixed economic data, ongoing geopolitical conflicts and the upcoming US election, it’s important to stay diversified or leverage multi-asset strategies to manage market volatility. 
  • The new supportive government measures have caused the recent tactical rally in the mainland Chinese and Hong Kong equity markets. However, we think it will need more support and time to resolve the issues in the property market and we therefore remain neutral in these markets. We continue to diversify in Asia, favouring India, South Korea and Japan. Following a surprise rate hike in Indonesia, we have shifted our allocation towards Malaysia based on improving global trade and IT activity.

Talking Points

Each month, we discuss 3 key issues facing investors

Asset Class Views

Our latest house view on various asset classes

Sector Views

Global and regional sector views based on a 6-month horizon

Mutual Funds Online

With MF Online we provide convenience to take informed financial decisions

Systematic Investment Plan

SIPs are small and disciplined investments in mutual funds that can be executed through HSBC on a monthly basis

Related Insights

Market expectations for Fed rate cuts have been on a roller-coaster ride, swinging from too...[23 May]
For the sixth consecutive meeting (since July 2023), the FOMC voted unanimously to leave...[3 May]
Prepare for an insightful journey with our CIOs who delve into the most critical topics...[26 Mar]
    Here's an easy way to share your thoughts, stay informed and join the conversation. Follow us: