FidelityConnects

Portfolio manager Steve DuFour speaks about his outlook on U.S. equities, the state of the U.S. markets and what lessons can be drawn from the 2016 Presidential Election. As an industry veteran and manager of the Fidelity U.S. Focused Stock Fund, Steve explains how he is upgrading his portfolio for investors.  He says healthcare and tele-medicine have seen lots of positive trends, as well as 5G and our ability to connect and consume products. He also says with COVID-19, those themes have been exacerbated and accelerated which has been helpful to those themes in the fund. Steve also touches upon ESG and says the dominion for good ESG data is growing rapidly. He speaks to CEOs and CFOs who have a mental picture of what their income statements will look like years from now. And for him the environmental and governance factors are what he focuses on.

Recorded on August 19, 2020.

As social issues are brought to the forefront by the coronavirus global pandemic, portfolio manager Nicole Connolly discusses the implications of COVID-19 for ESG across industries and financial markets. The ESG mandate is about aligning your capital, and ESG investing has been maintaining momentum through the pandemic. Nicole is investing in companies that are focused on making the transition to a lower carbon footprint. She notes there have been a lot of catalysts for environmental investing, and the E.U.’s recovery plan is largely driven by climate. One theme she believes to be up and coming is renewable hydrogen; she is focusing on this trend through wind energy companies. Amid the pandemic, racial tensions have been at an all-time high in the U.S., putting the social aspect of ESG front and centre. Nicole has been looking at companies and asking how they’re prioritizing employees, customers and the communities in which they are based. She believes investors are also considering whether they are putting their money behind the changes they want to see in the world.

Recorded on August 18, 2020.

In the sixth episode of the Fidelity ETF Exchange - powered by FidelityConnects, co-hosts Mike Riccio and Etienne Bouchard had the opportunity to interview David Tulk, Global Asset Allocation Portfolio Manager at Fidelity Investments. David and his team manage 29 multi-asset class funds with a total of $64.4B in AUM. Mike & Etienne picked David’s brain on the use of ETFs in their funds, how they weathered the COVID-19 storm and what is their current macroeconomic outlook.

Recorded on August 17, 2020.

Portfolio manager Michael Plage discusses opportunities for fixed income at this stage of the pandemic. Michael’s quantitative team regularly runs scenarios that determine how sensitive and exposed his portfolios are in relation to changes in rates. Currently his portfolios have very low sensitivity to changes in rates. We are in a low-rate environment, which Michael believes makes it a great time for active management, especially in fixed income, because delivering diversification and yield has become challenging. With the world’s population aging, he believes the hunt for yield and income paying assets will continue. Looking forward to the U.S. election, Michael notes that he and his team are not positioning portfolios for a specific outcome; rather, they are trying to identify the sectors that might see the most impact. 

Recorded on August 14, 2020.

Jurrien Timmer, Fidelity’s Director of Global Macro, joins us again to provide his weekly market outlook and global macro update. P/E ratios have almost doubled since the crash. Skeptics would say this isn’t justified, but at the bottom, price typically bottoms before earnings because markets discount the future. Jurrien believes that as we progress through a recovery, earnings will follow prices, and P/E ratios will go down once earnings catch up. He also notes we are on track to a recovery like the one in 2009. Regarding the US election, Jurrien notes that markets typically start paying attention to elections after Labour Day. With Joe Biden now confirmed as the Democratic presidential nominee, the market is probably taking some comfort regarding regulatory and taxation risks, because Biden can be considered a mainstream ticket. 

Recorded on August 17, 2020.

Institutional portfolio manager Naveed Rahman takes a close look at the companies and industries weathering ongoing unpredictability, opportunities for investors in the second half of the year and his global market outlook. Naveed works alongside Joel Tillinghast and Salim Hart on Fidelity Global Intrinsic Value Class, and he notes they are finding Japan to be an area of opportunity of late. They are also interested in utilities right now, which are trading at a discount, because interest rates are falling. Reflecting on the stimulus packages in the United States, Naveed explains there has been $5 trillion in stimulus in the U.S. so far. But, he believes further stimulus is necessary, because the virus has not been contained. He thinks politicians will do what’s right from an economic perspective, once all other options have been exhausted.

Recorded on August 13, 2020.

Jeremy Podger, portfolio manager of Fidelity Global Fund, discusses his outlook on portfolio management during market instability and identifies opportunities for global investing as equities continue to endure pandemic fears. Jeremy aims to keep a balanced, risk-controlled fund. He is currently allocating more than the benchmark to the information technology and health care sectors, and avoiding consumer staples. Jeremy notes that this year has seen a huge polarization in performance between value and growth, but he believes there are still two ways in which value can outperform. One is in a classic value bull market, with higher bond yields and sustainable economic growth accompanied by inflation. Two, is if growth collapses under the weight of its own valuation.

Recorded on August 11, 2020.

Our special guest today is the Honourable Navdeep Bains, Minister of Innovation, Science and Industry. Minister Bains has been the Member of Parliament for Mississauga — Malton since 2015, and was previously the Member of Parliament for Mississauga — Brampton South from 2004 to 2011. Minister Bains shares his outlook for Canada’s strategic sectors, attracting investment in a new world and Canada’s COVID-19 response. Minister Bains also speaks on the Industrial Research Assistance Program (IRAP), which provides technical and business innovation advice, financial assistance, and industry connections to over 10,000 Canadian small and medium-sized enterprises. IRAP has a growing international reputation, and has been identified as a best practice in providing a broad suite of innovation support services and funding.

Recorded on August 12, 2020.

Jurrien Timmer, Director of Global Macro, is back to provide his weekly market commentary. Jurrien continues to believe in a good barbell strategy (having both value and growth in your portfolio), and in capitalizing on U.S. secular growth trends and investing in emerging markets to gain value. One of the hallmarks of the COVID-19 crash cycle of 2020 is that what could have been a worse outcome was mitigated by the Federal Reserve (the Fed) and other central banks. Jurrien points out that the position the Fed is in is not a new one. In the 1940s, when the U.S. had massive debt and increased taxation, the Fed was able to orchestrate the economy and ensure that it saw the market play out the way it wanted. Jurrien shares his findings, explaining how the Fed is using quantitative manipulation and forward guidance to help the market retrace its steps, which has led to an orchestrated rebound. He supports this research with data and graphs that link with a Twitter thread. You can follow along with the slides: @TimmerFidelity on Twitter.

Recorded on August 10, 2020.

Portfolio manager Aneta Wynimko, manager of the Fidelity Global Consumer Industries Fund, analyzes the impact of COVID-19 on consumer spending and which segments have been affected the most by ongoing economic uncertainty. Aneta believes the U.S. consumer is the key driver of the global economy. Before the pandemic, half of the consumption of food was happening out of home, but it has now been brought back inside. We also saw a 33% savings rate at the peak – something that hasn’t happened since the 1950s. However, as travel becomes less risky, people are starting to venture out again, so it’s interesting to see all the different things happening. Aneta also believes the consumer plays a large role in the ESG trend, particularly given an increasing preference for “conscious consumption.” The move toward wellness and more broadly conscious lifestyles has become quite entrenched. Aneta notes that this is especially the case in the younger demographic, who are choosing brands that are “doing the right thing.” Generation Z tends to think more about a circular economy of reusing and reselling, as opposed to throwing things away.

Recorded on August 7, 2020.