Investment Team Handelsbanken Wealth & Asset Management
19 Sep 2025 15
Below, we outline some of our key views on the factors set to drive financial markets over the coming months, and what this means for our investment strategies.
What's next for the global economy and financial markets?
Laid back investors are feeling relaxed about tariffs
Over the summer, the US imposed trade taxes on most countries which had not yet negotiated a trade deal with President Trump. At the time, investors seemed exasperated, but this only resulted in a temporary dip in stock market performance. While there are points of strain appearing in various parts of the US economy (including the jobs market), this strain is not especially attributable to Trump’s tariff wars. The more time that passes without the impact of tariffs showing up in economic data, the less likely it becomes that any effects will materialise in a meaningful enough way to alarm investors. One very important trade date remains on the calendar for November: the deadline for a trade deal with China.
Jobs market weakness helped the US central bank to cut interest rates
At the start of September, US jobs market data for August was released. As the world’s most influential economy – and one which is driven by its consumers – the health of US employment markets is very important to both economists and investors. August’s employment figures indicated that hiring rates had weakened in the US, with the monthly addition of just over 20,000 new employees (a low point in recent history). Perhaps counterintuitively, financial markets had cause to welcome the news, as it supported the US central bank’s decision to cut interest rates earlier this week.
The Bank of England is biding its time
While the US central bank may have decided to cut interest rates this week, the Bank of England – which cut rates in August – opted to hold rates steady at 4%. Announcing the decision of his leading policymaker committee, the Bank’s governor, Andrew Bailey, highlighted that the UK is ‘not out of the woods’ when it comes to inflation. It’s worth noting that the ripple effects of Labour’s welfare bill are still being felt in the UK, particularly when it comes to the well-publicised hole in government finances. For now, markets are watching and waiting.
How are our investment strategies positioned for the next chapter?
We’ve spent the past 18 months or so simplifying our investment positions and making them exceptionally ‘liquid’ – ready to move easily if need be. Our investment strategies are well-diversified across different types of financial assets, including our stock market positioning, where we’ve previously slightly reduced our exposure to the choppy US market.
As we’re sure our clients already know, investing always means exposing your capital to the possibility of both rises and falls in financial markets, presenting both risks and opportunities. It’s our privilege to help you understand more about this, so if you would like more information, please do get in touch.
Our chart of the month
Source: Macrobond
What does this chart tell us?
Way back in March, we used our ‘chart of the month’ slot to highlight the price of gold, noting its stellar start to the year. Since then, the price of gold has continued to shoot higher. Investors have been viewing gold as the safest of havens, even versus other traditional areas of sanctuary like government bond markets. Central banks have also continued to buy gold, shoring up their reserves amid global uncertainty.
Within our multi asset funds, we’re happy to say that we are long-term holders of gold. This is also our only direct exposure to commodities markets.
Scroll down the page to the sections below to find out what our market views mean for positioning in our investment strategies.
- Towards the end of 2024, we slightly shifted the balance of assets held in our multi asset strategies, which resulted in our strategies holding slightly more in stock market investments than in the recent past.
- We favour the shares of larger businesses, and specific sectors including healthcare and insurance.
- We are neutrally positioned in the US market, recognising the high quality of the US marketplace, but currently seeing better opportunities on this side of the Atlantic (the UK and Europe). We’ve also recently added more stock market positions in developing economies.
- European shares – previously relatively out of favour – have found time to shine this year. Europe’s standing has been further boosted by Germany’s historic decision to loosen its purse strings and inject billions of euros into the economy via extra defence and infrastructure spending.
At the time of this update, we are 'neutral' stock markets/shares. This means that we have not deviated for tactical reasons from our overall asset allocation framework - a way of dividing investments across different types of assets. As a result, our multi asset strategies currently hold a proportion of investments in stock markets which is consistent with our long-term average.
- Towards the end of 2024, we slightly shifted the balance of assets held in our multi asset strategies, which resulted in our strategies holding slightly less in bond market investments than in the recent past.
- Having been a rather uninteresting part of financial markets for quite some time, bond yields rose higher in 2023 than they had done for many years (and bond prices, which always move in the opposite direction to yields, fell). This presented what we perceived to be an attractive buying opportunity.
- We still think bonds look attractive over the long-term, with yields at meaningfully higher levels than any point in recent years. However, late in 2024, we dialled back some of our enthusiasm for government bonds, reflecting risks and developments in advanced economies. Due to the UK’s weaker economic outlook, we continue to believe in a promising outlook for UK government bonds over the longer term, but remain cautious in the near term given the impending UK budget.
- Within our bond market positions, we have a preference for government bonds in developed markets. We also invest in high quality company debt, though we’re more cautious on lower quality corporate debt and bonds issued in developing economies.
At the time of this update, we are 'neutral' when it comes to bond markets. This means that we have not deviated for tactical reasons from our overall asset allocation framework - a way of dividing investments across different types of assets. As a result, our multi asset strategies currently hold a proportion of investments in bond markets which is consistent with our long-term average.
- The ‘alternative’ investment space covers a diverse range of assets outside of traditional bond and stock markets, from commercial property to specialist hedge funds. Because of their wide variety, it’s difficult to make sweeping statements about alternative assets, and our overall ‘underweight’ stance in this diverse area of the markets hides some specific preferences.
- At present, we have a preference for assets which can drive financial returns, without being closely linked to mainstream financial markets. Among our positions in property investments, we have a preference for global assets over UK-based assets, believing that this allows us to access a much more diverse array of property, from data centres to telecoms towers.
- Other notable positions include a long-term portfolio position in gold, and a specialist hedge fund designed to protect against dramatic market falls.
At the time of this update, we are slightly 'underweight' alternative assets. This means that we have deviated for tactical reasons from our asset allocation framework - a way of dividing investments across different types of assets. As a result, our multi asset strategies currently hold a relatively smaller proportion of investments in alternative assets versus our long-term average.
If you’d like further information on how we divide investments in our strategies across different types of assets (i.e. our asset allocation framework, and our tactical deviations away from it), please contact us.
Important Information
Handelsbanken Wealth & Asset Management Limited is authorised and regulated by the Financial Conduct Authority (FCA) in the conduct of investment and protection business, and is a wholly-owned subsidiary of Handelsbanken plc. For further information on our investment services go to wealthandasset.handelsbanken.co.uk/important-information. Tax advice which does not contain any investment element is not regulated by the FCA. Professional advice should be taken before any course of action is pursued.
- Find out more about our services by contacting us on 01892 701803 or exploring the rest of our website: wealthandasset.handelsbanken.co.uk
- Read about how our investment services are regulated, and other important information: wealthandasset.handelsbanken.co.uk/important-information
- Learn more about wealth and investment concepts in our Learning Zone: wealthandasset.handelsbanken.co.uk/learning-zone/
- Understand more about the language and terminology used in the financial services industry and our own publications through our Glossary of Terms: wealthandasset.handelsbanken.co.uk/glossary-of-terms/
All commentary and data is valid, to the best of our knowledge, at the time of publication. This document is not intended to be a definitive analysis of financial or other markets and does not constitute any recommendation to buy, sell or otherwise trade in any of the investments mentioned. The value of any investment and income from it is not guaranteed and can fall as well as rise, so your capital is at risk.
We manage our investment strategies in accordance with pre-defined risk objectives, which vary depending on the strategy’s risk profile.
Portfolios may include individual investments in structured products, foreign currencies and funds (including funds not regulated by the FCA) which may individually have a relatively high risk profile. The portfolios may specifically include hedge funds, property funds, private equity funds and other funds which may have limited liquidity. Changes in exchange rates between currencies can cause investments of income to go down or up.
This document has been issued by Handelsbanken Wealth & Asset Management Limited. For Handelsbanken Multi Asset Funds, the Authorised Corporate Director is Handelsbanken ACD Limited, which is a wholly-owned subsidiary of Handelsbanken Wealth & Asset Management, and is authorised and regulated by the Financial Conduct Authority (FCA). The Registrar and Depositary is The Bank of New York Mellon (International) Limited, which is authorised by the Prudential Regulation Authority and regulated by the FCA. The Investment Manager is Handelsbanken Wealth & Asset Management Limited, which is authorised and regulated by
the FCA.
Before investing in a Handelsbanken Multi Asset Fund you should read the Key Investor Information Document (KIID) as it contains important information regarding the fund including charges and specific risk warnings. The Prospectus, Key Investor Information Document, current prices and latest report and accounts are available from the following webpage: wealthandasset.handelsbanken.co.uk/fund-information/fund-information/, or you can request these from Handelsbanken Wealth & Asset Management Limited or Handelsbanken ACD Limited: 25 Basinghall Street, London EC2V 5HA or by telephone on 01892 701803.
Registered Head Office: 25 Basinghall Street, London EC2V 5HA. Registered in England No: 4132340