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This asset manager has thrown in the towel on every global stock market but the US And it doesn’t like bonds, either.

Global equity investors have few choices these days, and according to one asset manager that leaves pretty much one big market — Wall Street.

So says wealth manager Schroders in its August multi-asset investment outlook released Monday. The firm has turned negative on equities in the UK, Europe, Japan, emerging markets, China, and Asian ex-Japan, along with government bonds. It’s stayed neutral on commodities and credit.

Investors are “underestimating” the Federal Reserve’s resolve to get inflation under control, laid out by Chair Jerome Powell last week, a move that has left stocks struggling in the wake of that.

That central bank effort will “slow down growth and consequently, I think it makes sense to retain an overall negative view (on stocks) even though it’s been a painful position,” said Paul Duncombe, head of multi-asset product, UK & Europe , in a video message to clients.

But he also said that the summer rally for stocks to them does not exactly mean a market recovery, as “no unemployment and rising wages” will mean the Fed keeps pushing interest rates higher.

And for that reason Schroders has gone negative on bonds. “The market appears to be underestimating the lingering effects of inflation and valuations at current levels are difficult to justify,” said the asset manager.

While the US was the asset manager’s preferred market to be underweight previously, the firm has lifted those stocks to neutral “as fears of recession have traditionally been more supportive for US shares compared to other regions, due to the greater proportion of higher quality companies in the index.”

Negative positions on the UK are down to weaker demand becoming an issue for its heavily weighted energy companies. As for Europe, a negative shift comes following the first interest rate rise in a decade by the European Central Bank, which “will impact share prices, particularly if the focus turns to winter energy supplies,” said Schroders.

It’s gone negative on Japan stocks owing to building recession fears and the cyclical nature of the index, along with recent yen strength USDJPY,
+0.00%,
while disappointing stimulus initiatives by China’s government and valuations that no longer look cheap have soured the manager on that country’s stocks.

Global emerging markets, also cut to negative, are not a haven for investors as shares traditionally perform poorly during recessions, said the manager, which maintained a negative view on emerging market Asian stocks ex China owing to rising geopolitical tensions in the region, notably in Taiwan.

The S&P 500 SPX,
+0.28%
has dropped 16% this year, a slight outperformance to the 18% stumble for the MSCI All-Country World index.

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