JPMorgan Private Bank’s latest Private Client Survey has revealed that European investors expect private equity to be the best-performing asset class and European equities to take lead over US equities in 2016.
One-third (33%) of the respondent said they expect private equity to be the best-performing asset class, followed closely by public equity markets (28%) – a contrast to 2015 where over half of investors believed equities would perform the best.
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Nearly 16% of the investors said they expect hedge funds to provide good returns over the next year, while 14% clients said commodities would fare well.
According to the report, the majority of investors now favour European equities over the US. Nearly half (47%) of the investors said they see European equities outperforming other regions, while 35% opined that US equities will lead the way this year as well.
The survey report further revealed that Brexit and Spain’s general election remain the focus for financial markets in Europe, while the president race is the focus in the US.
When asked where the US Federal Reserve Federal Funds rate will stand by the year end, 37% of investors said they anticipate it to increase from 1% to 1.5%, while over half (59%) said they expect the Federal Funds rate to remain below 1%.
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By GlobalDataThe study also revealed consistent geographical opinion across Europe, with the exception of Spain where investors were evenly split on rates remaining under 1% and rising towards 1.5%.
Also, 61% of the respondents held the view that oil prices will remain close to where they currently are (between $30 and $40 per barrel) for the rest of 2016, while 28% expect prices to increase between $40 and $50.
JPMorgan Private Bank EMEA head of investments Peter Gabriele said: "Despite uncertainty from global monetary policies, China’s slowdown and plunging commodity prices, our clients remain positive about the investment environment."
