Q4 2021 EMEA Outlook Implementation Guide

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Keep it brief

  • As we move into the final quarter of Q4, investors are grappling with an unusually wide range of potential economic outcomes beyond the restart, reflected in frequent shifts in equity market leadership and, more recently, a sharp backup in yields. We stick to the anchor of our three key investment themes – and a broad strategic preference for equities over bonds in our updated long-term return assumptions. A more granular approach could help better capture these themes and provide diversification in portfolios, in our view.
  • In our Q4 2021 Outlook Implementation Guide, we look at how investors could position for Q4 2021, with an outcome-orientated approach to the key investment themes laid out in the BlackRock Investment Institute’s Midyear 2021 Outlook.
  • Download the full Guide to discover how these market views could translate into implementation ideas across asset classes, geographies and sectors for alpha-seeking, index, alternative and cash funds.

Key Themes

  • The powerful restart of economic activity has broadened, with Europe and other major economies catching up with the US. We expect a higher inflation regime in the medium term, yet see the US normalising policy rates only in 2023 and Europe staying put even longer. We double down on our preference for European equities.

  • China is on the path towards a greater role of state where social objectives will have primacy. Yet the growth slowdown has hit levels policymakers can no longer ignore, and we expect to see incremental loosening. We shift to a modest overweight in Chinese equities, and upgrade local currency emerging market debt amid multiple tailwinds.

  • Climate risk is investment risk, and the narrowing window for governments to reach net-zero goals means that investors need to start adapting their portfolios today. We like sustainable assets and those better-positioned for the green transition, including the tech sector.

This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or financial product or to adopt any investment strategy. The opinions expressed are as of October 2021 and may change as subsequent conditions vary.

Download the Q4 2021 EMEA Outlook Implementation Guide
This guide looks at how investors could position for Q4 2021, with an outcome-orientated approach to the key investment themes laid out in the BlackRock Investment Institute’s Global Outlook.
Read the full paper Read the full paper
Front cover of the implementation guide
Discover the BII 2021 Global Outlook – Q4 update
Read the latest views from BII across asset classes, as we take stock of recent events and their potential implications for tactical and strategic allocations.
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