With the escalating uncertainty globally, investors are looking for opportunities in US equities that have exhibited solid fundamentals and resilience amid tense trade talks, which received broad gains in the first half of 2018.

Legg Mason offers a suite of flagship US Equity funds

Why US Equities now

Icon Trade Concerns: Much lower than Fiscal Stimulus +

Fiscal stimulus boosting growth is likely to overwhelm the negative effects from any tariffs.

Tariffs vs. Incremental Fiscal Policy - 2018 Calendar Year

Chart

Source: Strategas Research Partners. Data as of 30 June 2018 in US$ billions. EU: European Union.

 

Icon Midterm Election: Positive Effect +

The periods (1-year around elections) tend to be positive for US equities. This may be due to the pattern of stimulus policies that typically accompanies elections.

US Equities: 1-Year Performance around Elections (starting from month end of Aprils)

Chart

Source: Bloomberg, as of 23 July 2018. Cumulative total returns of indices are based on month-end data: Period 1 (April 2010 - April 2011), Period 2 (April 2012 - April 2013), Period 3 (April 2014 - April 2015) and Period 4 (April 2016 - April 2017). Past performance is not indicative of future performance.

 

Icon Corporate Earnings: Steller Growth +

The market is expecting earnings growth of US companies to top the 1st quarter's record and the guidance for future quarters is also strong.

S&P 500 Index - Trailing 12 Month Earnings Per Share (US Dollar)

Chart

Source: Bloomberg, as of 23 July 2018. Annual data for 2018 – 2020 (Orange Bars) are estimated. Past performance is not indicative of future performance.

 


Source: Legg Mason, ClearBridge and Royce & Associates, as at 30 September 2018. The funds are sub-funds of Legg Mason Global Funds Plc, an open-ended umbrella investment company constituted in Ireland.

The Legg Mason ClearBridge US Aggressive Growth Fund and the Legg Mason ClearBridge US Large Cap Growth Fund may invest in certain types of derivative instruments for efficient portfolio management purposes. Please refer to the prospectus for more information.

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