Investing in Uncertain Times
Shifting US tariff policy introduced massive uncertainty. In this piece, we discuss how select high-quality companies can outperform during periods of turmoil.
State Street Global Advisors’ house view is that the US economy will slow for the rest of the year but is unlikely to enter recession. The Canadian economy is likely to follow suit, though uncertainty about US tariff policy remains. Although we expect the US Federal Reserve to continue exercising caution on interest rates in the near term, we anticipate opportunities for rate cuts later in the year. The Bank of Canada paused in April. However, our house view calls for two more rate cuts by July due to economic damage from US tariffs. Inflation should decline, but we expect it to be sticky on the way down as changes to supply chains constrain inventor
We continue to see the wisdom of an active and long-term investment approach, especially one focused on quality companies that have shown the ability to produce durable growth and trade at reasonable valuations. We are particularly focused on opportunities in advanced manufacturing and automation, with an eye toward identifying companies that will benefit from supply chain disruption and reshoring. In addition, the explosion of artificial intelligence (AI) presents opportunities to seek promising investments in AI businesses and to identify companies that are integrating AI into their existing processes in ways that boost their competitive advantage.
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- Our Active Fundamental Equity team discusses their responses to 2025 market volatility, including the portfolio adjustments they have made to date.
- We discuss how our proprietary confidence quotient informs our investment process, including a look at how tariffs and trade disruption affect our assessment of a company’s quality.
- A research analyst shares a deep dive into the often-overlooked waste sector, where careful analysis reveals a number of high-quality companies with appealing business models.