AIA CIO: ‘Equities will outperform bonds over the next year’

Written by Adam Cadle

11/10/2021

AIA chief investment officer Mark Konyn believes stock markets will outperform bonds for the rest of the year, but has warned about the potential impact of a global corporate tax deal on profit margins and economic growth.

Speaking to business news channel, CNBC, Konyn said: “Underpinning everything is global growth. I know there is a lot of negative sentiment out there about whether inflation is picking up, rising rates potentially and concerns over supply in various parts of the world, but nevertheless, when you look at earnings, particularly from the US, we are still seeing a strong foundation.

“We still believe global markets, and within global markets - global developed markets -will outperform bonds through the course of this year and the early part of next year.”

More than 130 countries have signed up to a global deal on corporate tax reform aimed at eliminating tax havens while bringing in $150bn more a year from multinationals. The agreeement includes a 15% global minimum effective corproate tax rate, plus new rules to force the world's multinationals to declare profits and pay more in the countries where they do business.

Konyn said the deal could “shave 1.5% to 2% off profit margins.”

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