While the backdrop for investors has been challenging over the past two years, global macroeconomic conditions are continuing to improve in 2024 as inflation moderates and expectations of monetary loosening intensify.
With stocks a likely beneficiary of ongoing positive economic momentum, investors have understandably been seeking to increase equity allocations. However, this focus has recently been concentrated on a select group of stocks as evidenced by the performance of the AI-linked Magnificent Seven, which contributed almost two-thirds of the S&P 500 return in 2023.
Even though AI continues to attract widespread attention, the improving broader sentiment is likely to reignite investor interest in opportunities beyond the handful of US tech behemoths. The spotlight could be set to shine on the US’ overlooked northern neighbour.
