1. Depreciating dollars
    As the US Federal Reserve continues to ease more aggressively than its counterparts, the US dollar has appeared vulnerable for the first time since the global financial crisis. Should this weakening become a longer-term trend, future investment outperformance is likely to come from different parts of the market than over the previous decade.
  2. Modern monetary theory
    Although there will be equity market winners and losers from the US presidential election outcome, the extraordinary nature of the current backdrop may make the result less significant than it would otherwise have been. Neither major party is making any attempt to subscribe to fiscal prudence, with the unprecedented stimulus creating a very real chance that we see a sustained acceleration of goods and services inflation.
  3. China’s latest credit boom
    As China’s economy ground to a halt, monetary and fiscal policy shifted in favour of economic stability at the expense of financial stability. Credit growth has accelerated, stimulating the housing market and supporting infrastructure investment. Notwithstanding ongoing trade tensions, we believe the conditions are in place for Chinese equities to continue to outperform, with increasing commodity consumption likely to support commodity exporters and the materials sector.

Important information
This is a financial promotion. These opinions should not be construed as investment or any other advice and are subject to change.

This document is for information purposes only. Any reference to a specific security, country or sector should not be construed as a recommendation to buy or sell this security, country or sector. Please note that portfolio holdings and positioning are subject to change without notice. Where the portfolio has exposure to hedge funds, gold, private equity and property via publicly quoted transferable securities, there are additional risks associated with these sectors.

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This material is for Australian wholesale clients only and is not intended for distribution to, nor should it be relied upon by, retail clients. This information has not been prepared to take into account the investment objectives, financial objectives or particular needs of any particular person. Before making an investment decision you should carefully consider, with or without the assistance of a financial adviser, whether such an investment strategy is appropriate in light of your particular investment needs, objectives and financial circumstances.

This information is made available by Newton Investment Management Limited and BNY Mellon Investment Management Australia Ltd (AFSL 227865). This information is confidential and is only provided to Australian wholesale clients (as that term is defined in section 761G of the Corporations Act 2001 (Cth)). This is not an offering or the solicitation of an offer to purchase an interest in the Newton Real Return strategy or the Newton Global Dynamic Bond strategy. This document is for general purposes only and should not be relied upon as financial product advice. This document has been prepared without taking into account the objectives, financial situation or needs of any person. Before making an investment decision an investor should consider the appropriateness of the information in this document having regard to these matters and read the disclosure document relating to a financial product. Investors should also consider obtaining independent advice before making any investment decisions. Investments can go up and down and to the extent that this document contains any past performance information, past performance is not a reliable indicator of the future performance of the relevant investment or any similar investment strategy.

Newton Investment Management Limited is exempt from the requirement to hold an Australian financial services licence in respect of the financial services it provides to wholesale clients in Australia and is authorised and regulated by the Financial Conduct Authority of the UK under UK laws, which differ from Australian laws.

Newton Investment Management Limited (Newton) is authorised and regulated in the UK by the Financial Conduct Authority (FCA), 12 Endeavour Square, London, E20 1JN. Newton is providing financial services to wholesale clients in Australia in reliance on ASIC Corporations (Repeal and Transitional) Instrument 2016/396, a copy of which is on the website of the Australian Securities and Investments Commission, www.asic.gov.au. The instrument exempts entities that are authorised and regulated in the UK by the FCA, such as Newton, from the need to hold an Australian financial services license under the Corporations Act 2001 for certain financial services provided to Australian wholesale clients on certain conditions. Financial services provided by Newton are regulated by the FCA under the laws and regulatory requirements of the United Kingdom, which are different to the laws applying in Australia.