Mercer Market Environment Report

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Mercer's Market Environment Report Details Impact Of Economic Conditions On Assets


   
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Mercer's Market Environment Report provides a detailed review of the capital market environment during the second quarter of 2015 and trends on the value of a wide range of assets. By completing the form below you can download a PDF of the full report.


Summary

Developed world growth is benefiting from easy financial conditions, lower energy prices and improving labor market conditions. The largest concern for the global economy remains around emerging markets. The slowdown in China’s economy is deepening and is likely to spill over to other area. Aside from India, we see little reason to be optimistic about the shorter-term prospects for other major EM economies due to languishing structural reforms. The Fed appears set to raise interest rates in 2015 which could temporarily unnerve markets.


Report Contents 

Performance

  • Equities close to flat and bonds lower for the quarter 
  • International equities leading in 2015 
  • Will diversification ever work?   

Macro environment

  • Europe again takes center stage 
  • US economy rebounded 
  • Bond yields rose globally in the second quarter 
  • Emerging economies remain under pressure 
  • Has the dollar run out of steam? 

Financial markets

  • Continue to favor equities over high quality bonds 
  • US profit margins to come under increasing pressure 
  • Earnings outlook for international developed stocks improving 
  • High quality bonds declined as rates rose
  • Rising credit spreads: A canary in the coal mine? 
  • Currency depreciation continues to plague local EMD
  • REITs hurt by higher interest rates
  • Hedge funds provided protection during the bond sell-off  
  • Liability driven investing: Prepare for move to strategic hedge target 


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