RBC Wealth Management has launched the Global Insight 2024 Outlook, which showcases unique perspectives on the catalysts and challenges that could impact investment portfolios in the year ahead.

As we approach the end of another eventful year, we would like to share several highlights of the views informing our thinking as we head into 2024.  Chief amongst them are looking at the attractive opportunities in low-risk investments, how we are preparing for a wide range of potential economic outcomes in 2024, and evaluating the Global opportunity set.

In addition, you can enjoy the complete RBC Wealth Management 2024 Outlook report in pdf format at the link below, along with featured articles and regional focus commentaries on the mobile-friendly links.

As always, we remain committed to your long-term financial success.

Bond investments - Most attractive in 16 years RBC Capital Markets forecasts yields dropping from 4.6% to 3.95% by the end of 2024. In that case, investors would receive a 5% price increase in addition to the high yield leading to a potential total return of nearly 10%. As investors can achieve long-term target returns with less risk, we have been active in moving from cash and cash equivalents to lock in yields for longer. For more insights on the bond environment, please see the full report linked here.

Equity investments – Positioning for a wide dispersion of outcomes Though a wide dispersion of outcomes are possible, we do not discount the potential for the market to reach new highs. To capture this, we have continued to focus on maintaining exposure through businesses that can weather a better or worse-than-expected economic outcome, including a meaningful recession.

The Canadian Economy – Rate hikes nearing the end? We expect the bank of Canada to conclude its rate hikes soon, easing pressure on Canadian consumers. That said our economy faces notable headwinds when compared to our US counterparts, most notably highly elevated household debt and the importance of our housing sector to the economy. We see the current discounted valuation and heavy exposure to the resource sector as hedges against unfavorable inflation surprises. For more insights, please see the Canada regional focus linked here.



The US Economy – Soft or hard landing In our view, both are plausible however on balance high rates and tighter lending standards historically have led to recession. We have already seen this play out in Canada, the UK, and the eurozone. Valuations in the US stock market currently are reflecting an ideal scenario, a soft landing and continued earnings growth – leaving little room for error. For more insights, please see the U.S. regional focus linked here.

Election years - The stock market Election years and their market effect are much discussed, however on balance, the market has typically performed well. As per RBC Wealth Management, “Since 1928, the S&P 500 rose 7.5% on average and ended the presidential election year in positive territory almost 75% of the time”.



You can enjoy the complete report in PDF format here: Global Insight

Additional regional insights - Our on-the-ground analysts and strategists around the world examine the issues and opportunities facing markets and asset classes in 2024 in the UK, Europe, and Asia.

Contact us with questions and to discuss pertinent investment ideas.

We appreciate the opportunity to serve you and look forward to continuing to help you accomplish your long-term financial goals.