Portfolio Changes to Make for the Second Half of the Year

The second half of the year will likely bring more modest equity returns, according to one asset management firm. Barry McInerney, co-CEO of BMO Global Asset Management, said investment strategies are shifting as the market environment changes. He sees selective opportunities in equities, but adds ‘it’s getting late in the game.’ McInerney recommends a slight overweight to equities, but with more global diversification. ‘We were overweight U.S. equities last year, we’ve pulled that back a bit to more of an emphasis on international, particularly European and Asian,’ said McInerney.’ He also said clients are growing more cautious. ‘There’s some concerns from our clients on both where the equity markets are now in terms of perhaps an overvaluation, and the bond market with interest rates soon rising,’ he said. McInerney said earnings will be a key driver for the stock market for the rest of this year, and he’d like to see more top-line growth at companies, rather than cost-cutting.