(AOF) – “Two major long-term trends are likely to continue” several months after Donald Trump's victory, namely “a resilient American economy and an increase in the United States debt”. This is what Rebekah McMillan, associate portfolio manager at Neuberger Berman, says. For her, the American equity market “should continue to diversify beyond mega-caps in the technology sector”. In the long term, it favors “the best positioned sectors, the companies most exposed to megatrends” such as AI.
It will also rely on “experienced management teams, capable of dealing with the next major events that await us”.
Bonds “could face new difficulties,” continues the manager. In the short term, pro-growth and potentially inflationary policies “call into question the Fed's expected rate cuts”: these cuts are gradually removed from market expectations.
The decision of the Federal Open Market Committee (FOMC) expected on Thursday, and especially the nuance of Jerome Powell's message, will be “crucial”. “Concerns over the deficit and debt sustainability could put further pressure on long-term returns,” and “given Donald Trump's spending agenda, this is likely to remain a key issue through 2025.”
