Karen Ward

Short-term interest rates are a big opportunity because the market is overpricing the likelihood and magnitude of central bank rate hikes. The ECB and Fed will at most deliver a gesture hike, and then stop, meaning short-term yields are too high and will decline.

US Tech is "priced for perfection," while Europe is trading at historic discounts. Germany is shifting its fiscal stance, moving away from strict austerity ("Black Zero") to stimulus (1-2% of GDP). Markets are obsessed with Monetary Policy, but Fiscal Policy is the new driver. A fiscal unleash in Germany changes the structural growth narrative for Europe. Beaten-down sectors like Autos may benefit from government support to compete with China. LONG. Rotate out of US Mega Cap Tech into European Cyclicals and Germany. Fiscal stimulus gets bogged down in bureaucracy; trade tariffs from the US hurt European exporters.