Throughout William Blair’s history, our professionals have been committed to helping clients navigate tough markets by acting as their trusted advisor. Providing solutions for our clients’ unique challenges remains a common goal across all our different lines of business, and our leaders have constructive views on global economic and market dynamics.
Looking ahead to the second half of 2024, common themes include interest rates and inflation, elections in the U.S. and abroad, growing geopolitical conflict, and all eyes on the Federal Reserve on its next move. Hear directly from William Blair’s global leaders and the solutions they propose.
Stephanie Braming, CFA, Global Head of Investment Management
Clients are focused on inflation, interest rate trajectory, and geopolitics. Against this backdrop, they are assessing their allocations given the outperformance of the “Magnificent Seven” versus broader global equity markets.
As a result, we’ve been engaging with our clients regarding our active, diversified approach to large-cap growth. Others have been interested in broadening exposure to U.S. small- and mid-cap stocks due to current valuations, earnings growth, and the expectation of stable to lower interest rates. In addition, we’ve been speaking to clients about emerging markets equity for those who want to capitalize on improving growth opportunities and supportive valuations.
Given current interest rates, clients are also assessing alternative yield opportunities while fine-tuning private market exposure, with some concerns about private credit. Emerging markets debt has been a notable area of discussion with these clients, given its solid yield outlook, supportive macroeconomic environment, and attractive valuations.
Ryan DeVore, Head of Private Wealth Management
The sentiment among clients is relatively balanced, given that markets and major asset classes have positively navigated a global pandemic, supply chain shocks, inflation spikes, interest rate increases, geopolitical conflicts, and more. This has produced a fairly resilient economy, historically strong employment numbers, and market indexes that have seen new highs in 2024.
Markets and clients are paying attention to monetary policy considerations, geopolitical conflicts, and valuations in advance of the second half of 2024. More specifically, we are helping clients with planning and preparing for the Tax Cuts and Jobs Acts sunsetting at year-end 2025 and revisiting asset allocation strategies given market indexes being driven by a narrow group of equities, alongside a re-emphasis on the purpose of capital, and what “wealth” means to families. With markets advanced, volatility lower, rates stabilized, and potential estate tax changes on the horizon, this is a very opportune time to take a fresh look at all things financial.
John Kreger, Director of Equity Research
Clients are closely watching for signs that the cost of capital will stabilize or decline, as widely anticipated at the beginning of the year. For that to happen, inflation and the economy must cool further, creating the prospect for an additional fundamental deterioration in earnings.
Our team expects interest rates to continue to be the market's primary driver in the second half of the year. William Blair strives to help clients navigate such uncertain times by identifying compelling investment themes that are structural rather than cyclical and then find high-quality companies that are likely to thrive.
Scott McLaughlin, Head of Equities
Clients are focused on inflation, rate expectations, and companies' ability to deliver financial results against this backdrop. We anticipate the year's second half will be driven by the Fed's ability to navigate a soft landing as inflation slows and U.S. corporate earnings continue to hold up. We also need to be mindful that U.S. elections and geopolitical risk pose some uncertainty in the back half of the year.
William Blair's Equities team acts as a trusted advisor who helps our clients navigate challenging markets. We are tasked with understanding client needs and working as one team to deliver that value in a timely fashion.
Matthew Zimmer, Global Head of Investment Banking
We’ve seen improved sentiment from our clients, but they still often face lower valuations due to high interest rates. Downward movement in rates—and a clear path to further cuts—will help, and the market has already improved as rates have stabilized with limited risk of future hikes. As investors become less weary of a looming recession and increasingly convinced that a soft landing is feasible, acquirers will be more comfortable deploying capital at improved valuations.
William Blair’s expanded set of solutions—secondary transactions, private placements and minority recaps, and broadened IPO capabilities—have become increasingly relevant to our clients. Our product offerings allow them to achieve partial liquidity for a specific investment while potentially retaining a significant stake for a subsequent, and bigger, transaction at a later date. Additionally, we continue to modify our mergers and acquisitions sales processes to ensure high certainty in closing deals.
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As the financial markets evolve, William Blair continues to be committed to guiding our clients through complicated dynamics. Our strategic position allows us to leverage ongoing trends to best ensure investments are in a strong position to grow. Consistency and continuity remain a hallmark of William Blair, and we look forward to focusing on our clients and their needs.