At last - a relatively tranquil couple of weeks for equity markets. Strong economic data continued to be reported across developed countries and Asia, providing a solid backdrop for the Q1 earnings season that starts later this month. The sole exception was US retail spending, which showed another modest decline. Slower consumer spending due to inflation remains the main economic risk, albeit a modest one as inflation now appears to be subsiding.

Somewhat inconsistently given this backdrop, US interest rates fell 10-15 bps over the past two weeks, catalyzing a 3-5% drop in the among the Financials sector in US equity markets. With pretty clear signaling of on-going rate hikes from the Fed, we think this presents a window of opportunity to increase exposure to the US regional banks.

Separately, it is worth noting that the Tech sector has quietly resumed its strong performance. The financing window is clearly open, with multiple $500MM+ IPOs in the US over the past month, and with Flipkart and Lyft (both still private) raising $1.5B of equity last week on valuations of over $10B in both cases. Yet another signal of positive investor sentiment...