SCB-Julius Baer Securities Co recently organised an exclusive seminar for its ultra-high-net-worth clients titled "Market Outlook 2023: Opportunities Amidst Uncertainty".
The seminar covered the bank's economic outlook for 2023, expectations of lower inflation and slower economic growth in 2024, key investment highlights, and divergence between global economies.
Commenting on the global economic outlook and why a global recession is unlikely, chief executive Lalitphat Toranavikrai said: "Our market outlook for 2023 suggests this will be a cool-down year, with trends from the past year expected to slow and economic growth and inflation rates easing because of tight monetary policy."
"Despite a cooling trend in the global economy, particularly in the US, there are positives to consider. With resilient consumers, strong balance sheets and encouraging labour market conditions, the US economy could mitigate potential contractions or experience it mildly. Moreover, as China catches up after its reopening and Europe's prospects brighten with increased Chinese demand, we expect some degree of global economic balance."
Head of investment solutions Kean Tan said the firm's strategy for this year is concentrated on quality.
"Our approach is to focus on quality assets, securing decent real yields within fixed incomes. Given the rising concerns over defaults, we are reducing exposure to high-yield US and EU bonds, reallocating towards the promising arena of emerging market debt," he said.
"In the realm of equities, our stance remains defensive, with a clear focus on quality growth. We are overweight on the communications sector, and as for Chinese stocks, we recommend state-owned enterprises as structural reform is expected to raise competitiveness.
"With expected interest hikes, we expect the US dollar to weaken, whereas the Swiss franc is predicted to strengthen as a safe haven amid rising global growth risks, while the Japanese yen will likely benefit from any upcoming policy shift by the Bank of Japan. Also, as the artificial intelligence race intensifies, we favour software companies with proprietary data, the semiconductor value chain, and cloud infrastructure providers, for they continue to present attractive investment characteristics."
SCB Julius Baer Securities, a joint venture in strategic wealth management between Siam Commercial Bank and Julius Baer, a Swiss-based wealth management service provider, said it was committed to providing its clients with insightful and timely investment guidance, empowering them to navigate through these uncertain economic times.
