Robeco - Multi-asset market outlook

General overview:

– The top three of the most important trends for June? Easy: Greece, Greece and – somewhere in a distant third place – maybe China. The news of a Greek referendum, handing the decision of whether or not to stay in the Eurozone to the Greek people, was the latest plot twist in the ongoing saga. Up until that point, the Greek situation had been viewed as a local event, mainly of interest for European financial markets. But the surprise referendum move promoted Greece to the big league, with stocks around the world suffering the consequences. From an economic perspective, it should not have had such an impact, as Greece is little more than a rounding error if you look at the size of its economy compared to the world. Nevertheless, it unnerved sentiment, which drove most risky assets lower. We would be tempted to think that we are now very close to the point that we get more clarity with respect to Greece, but we have been thinking that for some time now. We consider the likelihood of a Grexit to be around 70% following the convincing ‘No’ vote in the referendum.

– Thanks to the Greek turmoil, the non-eventful month turned into a loss-making event for most asset-classes, the Agricultural sector marking the exception. We have made no changes to our tactical asset calls, staying mostly sidelined to wait for better opportunities to re-enter the market.