The stock market has rallied this year because the consensus view about the economy in 2023 and 2024 has gradually shifted towards a soft landing.
If the economy experiences a soft landing, we would expect commodities and banks to perform well in H2 2023.
First, oil looks poised to rally in the near term.
Second, banks could benefit if interest rates consolidate at higher levels. That may well happen because of sticky inflation.
In general, the 2020s will probably be a difficult decade for investors, due to worsening demographics, geopolitics and the energy transition.
However, our view is that these difficulties will most acutely be experienced by Growth investors. Value investors could instead have a good decade, with 10%+ annual expected returns available from a well-managed Value stock portfolio.
Rubis and Prudential were replaced by TotalEnergies and BNP Paribas.