The “Top Questions from our Clients” publication is a monthly periodical that posits the most important questions, answers, and portfolio implications curated from across different regions. The April edition addresses the below topics:

• Question 1: Which markets and sectors are most exposed to Middle East conflict? We believe Gulf economies, EM nations and open economies sensitive to global growth are the most impacted and most likely to remain under pressure if the conflict persists. Sectorally, Transportation and Industrials may face headwinds. However, de-escalation could support a rebound in energy importers and GCC economies. We overweight US equities and diversify using volatility strategies and alternatives
• Question 2: How credible are expectations of 15 per cent US earning growth in the current environment? The consensus estimate of 15 per cent earnings growth remains achievable, supported by broadening AI-driven momentum and resilient corporate fundamentals. While risks from energy, rates and softer consumption are rising, we maintain a mild overweight on US equities, favouring growth-style stocks and cyclicals, alongside high-quality fixed income, alternatives and volatility strategies for diversification
• Question 3: What explains the resilience of Chinese equities and RMB amid recent volatility? Amid persistent Middle East uncertainty and energy-driven risks, EM Asia faces heightened volatility. However, Chinese equities and the RMB remain relatively resilient, supported by policy support and inflows. We remain overweight Chinese equities and are constructive on RMB, while we have cut EM Asia to neutral and favour selective FX diversification to enhance portfolio resilience
• Question 4: Are strains emerging beneath the surface in private credit markets? Amid some areas of borrower stress, higher-rate pressures, and AI-related anxiety, pockets of strain are emerging in private credit. However, these remain largely idiosyncratic rather than systemic, with high-quality assets broadly intact. For long-term investors, we favour disciplined managers focused on resilient, mission-critical businesses, conservative capital structures and credible exit pathways
• Question 5: Are long-duration government bond yields likely to rise further? Bond yields have risen amid the ongoing Middle East conflict, driven by higher oil prices and rising inflation expectations. While yields may edge a bit higher in the near-term, we don’t expect a sustained move at the long end. So, we continue to add high-quality bonds in our balanced portfolios, favouring Australian sovereigns, UK conventional and index-linked gilts alongside IG and EM LC bonds
• Question 6: What key risks could derail US markets ahead of the midterm elections? Ahead of US midterms, markets face policy and geopolitical risks, particularly around tariffs and energy. While trade negotiations may offset some of the concerns, sustained tensions in the Middle East could keep inflation and risk premia elevated. We remain mildly overweight US equities, favouring growth and cyclicals, alongside high-quality fixed income, with gold, alternatives, and hedge funds as key diversifiers