Investing.com - The second quarter is coming to an end, and analysts at Barclays have taken a look at the investment outlook for global equities in the second half of the year.It has been another good quarter for investors, with global equities led higher by strong gains for the dominant U.S. Big Tech sector.
Valuations might seem full, but this is still a supportive environment for risk assets. This has led the bank to maintain its overweight stance on global equities over fixed income for the third straight quarter, even while expressing caution given elevated valuations and rising political and trade risks.
“Political risk is likely to stay elevated through higher risk premium in European financial assets until at least July 7, and possibly for months beyond,” Barclays added. And last week, the former President mooted the idea of scrapping income tax altogether and offsetting the revenue loss with an ‘all-tariff’ policy.
“We believe that if the AI demand is to sustain, the rally will need to broaden into other sub-segments such as data center interconnect ,” Barclays added. The U.K. bank has downgraded its tactical “overweight” view on European equities to “medium weight” after the French election was called.