Quarterly Market Environment Report

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Mercer's market environment report provides a detailed review of the capital market environment and trends on a wide range of assets classes.

Few safe havens during Q1



The April 2020 edition covers the following discussions:

Performance

  • Few safe havens during Q1        
  • US large-cap growth held up relatively well

Macro Environment        

  • Economic uncertainty abounds as a result of global shutdowns
  • US economic downturn likely the worst since the Great Depression
  • The Fed has reduced the risk of a financial crisis               
  • Global equities remain at risk over the short-term             

Financial Markets

  • US equities likely to lose the buyback tailwind                                    
  • The dollar is vulnerable once financial conditions normalize         
  • A weak macro outlook for int’l developed stocks                              
  • Emerging markets are attractively valued, but may face difficulties responding to the crisis
  • Favor TIPS over Treasuries
  • Investment-grade bonds should benefit from Fed support            
  • Time to buy high yield debt                                                                        
  • Emerging market debt slides due to currency weakness
  • Hedge funds limit losses, but with heightened dispersion             
  • Factor and manager universe performance
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