Citi Personal Wealth Management

No Rest in November

Monthly Market Snapshot: November 2018

Highlights

The month of November kept many investors awake at night. Concerns about slowing global growth, ongoing trade tensions, Brexit negotiations, and imbalances in the oil complex held markets captive. However, following a rally late in the month, the S&P 500 finished the month 1.8% higher. Equities outside of the U.S. were also largely positive with the MCSI All Country World Index (excluding the U.S.) adding 0.8% during the month.

Citi’s economists and strategists continue to believe that we are in a “late-cycle” phase, not an “end-of-cycle” phase. “Late-cycle” investing often means more market volatility and subdued equity market returns, but it doesn’t imply the onset of a U.S. recession in 2019.

Citi Private Bank’s Global Investment Committee (GIC) has been gradually reducing its exposure to global equities for some time and has been actively increasing portfolio quality. As part of this portfolio shift, the GIC has brought down its global equity overweight to +1.0%. This means that a Risk Level 3 blended portfolio without hedge funds would be comprised of 61.4% equities (an equity-neutral portfolio would hold 60.4% equities). On the fixed income side, preferred assets include short-duration, higher quality debt like U.S. Treasuries.