Edelweiss CIO Predicts Strong Year for Equities in 2024

Swiss asset manager believes rate cuts will drive investors to make moves in markets, and also predicts renewed interest in IPOs.

FRANKFURT, HESSE, GERMANY, December 13, 2023 /EINPresswire.com/ — Christoph Metzger, the Chief Investment Officer of Swiss asset management firm Edelweiss Capital Group, has predicted that 2024 will be a ‘strong year’ for equities markets because of the ‘clear signals’ from the US Federal Reserve that it is satisfied with the efficacy of its anti-inflation rate increases.

On Wednesday, the Fed said that it would be holding its interest rates steady and could cut rates 3 times next year. Earlier, Goldman Sachs and Barclays had predicted 2 rate cuts in 2024. In response to the Fed’s announcement, the Dow Jones Index, S&P 500 and NASDAQ all posted gains of around 1.4%.

Metzger said: “This is a very clear signal that the Fed considers that its mission of lowering inflation has been accomplished, and the focus throughout next year will be on growing the economy. This means 2024 will likely be a strong year for equities.”

“When interest rates are lowered, this means that the risk-free rate of return on capital will be lowered. Investors will no longer be able to get 4.75% or 5% on a fixed deposit. Debt investments are going to seem much less attractive. A lot of people will once again be looking to make moves in equities markets.”

The seasoned portfolio manager, who previously held positions at UBS and Schroders, also believes that IPOs could make a return, which in turn could spark renewed investment interest in the technology sector.

Metzger said: “We could see a surge in IPO activity, as there are a lot of strong private companies who had IPO plans in 2022 and 2023 but delayed them thanks to the perceived flatness in the stock market. A lot of these companies are going to be in the technology space. When you are backed by venture capital, it is a matter of time before these investors are going to be pushing for an exit. Many of these companies were already ready to go public, but were just looking for the right time.”

Edelweiss was founded in 1974 as an advisory firm focusing on estate planning and asset protection. The firm currently manages over $5 billion in assets for over 1,000 clients around the world.

Bryan Emmons
Skorsky Emmons LLC
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