Capital Market Outlook

The report evaluates the U.S. budget deficit, China's trade surplus, and the sustainability of the AI-driven equity bull market. It maintains a constructive, overweight outlook on equities while advising investors to focus on diversification amid potential near-term volatility.

Key Takeaways

• 1.The U.S. federal budget deficit is viewed as a manageable structural headwind rather than an existential risk.
• 2.Market drawdowns are considered normal investment behavior and potential buying opportunities for long-term investors.
• 3.China's structural trade surplus is driving global mercantilism and protectionist policies, reinforcing the firm's conviction in a multi-year infrastructure buildout.

Table of Contents

• Macro Strategy
• Market View
• Thought of the Week
• Markets in Review

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