Michael Metcalfe

Investors should continue de-risking due to the inflation shock from the Middle East conflict worsening. The economic impact is unfolding, with U.S. inflation already above 4% and rising quickly, indicating a larger shock than initially thought. De-risking means moving out of equities and into cash, as the long end of the fixed income market also faces risks from lower growth, higher inflation, and fiscal concerns.

Tech stocks have been a relative safe haven as investors rebalance away from cyclicals in this environment. Even though tech is a large overweight, investors have moved back into it because they don't want cyclical exposure.