Key Takeaways:

• Australian Market Outlook: Despite weak economic growth and declining earnings, the Australian market
  continues to rally, though we believe a defensive stance is prudent given concerns about the RBA’s stance and
  market valuations.
• Global Positioning: Globally, maintaining a long-term, valuation-driven strategy has historically outperformed.
  We favour value and size factors, which are well-positioned for a reflationary regime, particularly in sectors like
  small-cap and cyclical stocks.
• Monetary Policy and Economic Conditions: The U.S. economy shows resilience with stable labour markets,
  supported by government spending and rate cuts. We expect a soft landing, led by cyclical and small-cap stocks,
  and a weakening U.S. dollar, benefiting emerging markets.
• China’s Market Surge: China’s stock market rally, driven by government support, depends on further fiscal
  stimulus to sustain momentum, particularly in addressing the property market downturn.
• Portfolio Adjustments: We have adjusted our portfolio to maintain a neutral equity weight, with a mild
  overweight in fixed income. We emphasise value equities, defensive positioning in Australia, and have reallocated
  from Asia to pro-cyclical U.S. exposure, particularly through the S&P500 equal weight ETF (QUS).