Summary of global themes for 2021

Below is a summary of the main global themes that have emerged from HLB Mann Judd Brisbane’s recent discussions with fund managers and investment market commentators. It addresses our response to:

  • Market adaption
  • Vaccination programs
  • Economic trends
  • Potential political impacts

Market adaptation

COVID-19 has caused rapid adaptation in the way populations consume, receive information, access healthcare, and engage with employment. The success of this adaptation has enabled an unexpectedly strong global market rally in recent months.

Vaccinations

The development of innovative and effective COVID-19 vaccines in an exceptionally short timeframe will have positive flow-on effects to management of other diseases. Optimists believe the multiple viable vaccines have ‘solved’ COVID, with the more pessimistic commentators citing virus mutations and delivery problems as reasons for caution. Herd immunity due to successful vaccination of populations could see a strong economic rebound in developed markets by late 2021.

Digital or physical vaccination ‘passports’ may be required for border crossings, and access to travel, entertainment venues and business premises.

Economic impacts

  • Pent-up demand is expected in heavily-impacted sectors such as tourism, financials, and manufacturing.
  • Employment is likely to recover towards year-end, although, will require infrastructure investment and careful management of job displacements by governments and corporates.
  • Fund managers expect a cyclical rotation from the COVID beneficiaries (e.g. health and technology investments) to continue.

Political impacts

Focus on sustainability and climate change is likely to continue to accelerate, driven by changing expectations of regulators, political leaders, and investors, particularly the Millennial demographic. The Biden administration is expected to bring renewed focus on climate change and a dampening of geo-political tensions.

This article was authored by Jane Crombie, Australian Financial Services Licence No. 326490 from HLB Mann Judd Brisbane and is a general summary of common investment themes. Always seek professional advice specific to your circumstances. For more information contact: jcrombie@hlbqld.com.au