- International markets may continue to attract investors in the second half of 2017, particularly in Europe, which lags the U.S. economic cycle.
- In the United States, a number of favorable trends remain in place and are likely to keep politics from derailing market momentum.
- The latest twists and turns of Brexit have caused many to overlook stocks that we think are fundamentally strong.
For U.S. equity investors, the second quarter offered a number of familiar themes: relatively low volatility, new record highs for major indexes, and a modest advance for stocks. Along with these positive trends, however, came a decidedly lower level of optimism about progress from Washington in implementing pro-growth, business-friendly policies. Non-U.S. stocks across the developed and emerging markets outperformed their U.S. counterparts for much of the second quarter. Emerging-market stocks, in particular, continued to build on their momentum, as global interest rates remained low and the U.S. dollar's strength ebbed.