St. James's Place (SJP), a UK-listed wealth management house, has made adjustments to its asset allocation strategy, maintaining an underweight stance on US equities due to high valuations [097f0677]. The firm prefers to hold stocks in other markets, such as Europe and the UK, where it takes a slightly more overweight position [097f0677]. Hetal Mehta, head of economic research at St. James's Place, stated that US valuations are very stretched and the firm's core process is valuation [097f0677]. SJP has over £179 billion ($227.5 billion) of assets under management and is overweight on emerging market equities [097f0677]. Mehta also mentioned that UK equities are currently out of favor but show signs of improvement, leading the firm to be overweight on UK equities [097f0677]. SJP has an underweight position on US stocks relative to the MSCI ACWI benchmark [097f0677]. Mehta highlighted some signals of a possible recession in the US, such as low unemployment and high wage growth, while noting that the UK labor market has some slack and there are cracks on the employment side [097f0677]. The firm also discussed the impact of new technologies, particularly artificial intelligence, and the difficulties caused by current uncertainties [097f0677]. SJP noted that there is a consensus about a move towards a more isolationist trade and foreign policy by the US [097f0677].
State Street Global Advisors has announced the rebalance of its Active Allocation Model Portfolios, indicating a theme of diversification and caution [739d92cf]. The rebalancing includes an increase in positions to international stocks through the SPDR Portfolio World ex-US ETF, as well as a focus on quality fixed income positions and expanded exposure to emerging markets [739d92cf]. State Street also trimmed positions in short-term debt and gold, while adding duration to some portfolios [739d92cf]. The rebalance suggests State Street remains positive on U.S. equities but is also heeding the call for caution and diversification [739d92cf] [739d92cf].