What a Difference a Year Makes

By Brent Puff - October 31, 2018

A year ago, I talked about the favorable backdrop for equity markets driven by synchronized economic growth around the world and the strength in corporate profits. Today, the economic backdrop is more disjointed, equity markets are more volatile and the two largest and most important economies on earth—the U.S. and China—are in the midst of a growing trade war.

Although we acknowledge equity returns face a few more challenges going forward than they did a year ago, we continue to believe the outlook for equities is favorable and here’s why: the rate of growth in corporate profits is still fairly strong and economic activity, while moderating, remains healthy.

The headwinds our investment team continues to closely monitor include US dollar strength, inflation, the continued tightening of US monetary policy, and economic disruption induced by US/China trade friction.

In my latest quarterly video, we’ll do a deep dive into all of these issues and also reveal what single issue surprised me the most in the third quarter.

Brent Puff
Brent Puff
Global and Non-U.S. Equity

TRANSCRIPT

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      Generally, as interest rates rise, the value of the securities held in the fund will decline. The opposite is true when interest rates decline.

      Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

      The opinions expressed are those of American Century Investments (or the portfolio manager) and are no guarantee of the future performance of any American Century Investments' portfolio. This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.