Barclays' Chief Market Strategist in London: Global markets will face repricing in 2025, diversified investment will become a key strategy.

Barclays' London-based chief market strategist Julian LaFargue stated in a research report that the global market is undergoing a major shift in 2025. The US economy experienced actual contraction in the first quarter, developed market indices outperformed US stocks, and the US dollar has depreciated by 10% since its peak in January. The bank advises investors to adopt a strategy of selecting assets and diversifying their investments. The bank firmly believes that higher quality asset allocation is the cornerstone of a portfolio, while also seizing short-term regional adjustment and yield enhancement opportunities. Barclays' key points are as follows: Everything has changed. Six months ago, a more bullish US trade policy, a weakening dollar, and economic contraction were not the basic scenario. After experiencing its first reality check, the market is now uncertain about what to expect. Ultimately, the outcome should be quite mild, opening the door for investors to reconsider diversifying their investments. The Start of 2025 The start of 2025 has been astonishing. A series of events in the first half of the year once again proved that consensus is often wrong, especially in such a unilaterally strong situation. Six months ago, people believed that the US would continue to maintain its dominant position, and the upcoming Donald Trump administration would drive economic growth and risk assets (including the dollar). In November 2025, the bank warned that the future would enter a phase of lower returns. Fast forward to now, the US economy actually experienced contraction in the first quarter; developed market indices outperformed the US stock market; and the dollar has depreciated by 10% against a basket of other currencies since hitting its peak in January. Uncertain Prospects Unfortunately, for investors, the current consensus is even more ambiguous than six months ago, making it harder to understand the "other side" of trade impacts. Nevertheless, there are signs of complacency: the impact of US tariffs, blind optimism about the outlook for the Eurozone, and the widespread view that the dollar will further weaken. While these views are not extreme, they make the bank aware of where the areas of "painful trades" are, and which aspects need to be subjected to reality checks. "Although global investors may reconsider where to allocate funds, they will not abandon US assets." Stay Grounded In the remaining time of 2025 and the next year, global economic growth seems to be weakening, and inflation is expected to decrease. Therefore, interest rates should further decline. In this environment, selecting assets and diversifying investments remain crucial. As the bank has mentioned before - as it pointed out in November - the speed at which the market narrative changes is often much faster than most investors adjust their portfolios. Investors should not chase the latest trends or overreact to recent concerns, but rather focus on maintaining a steady operation. The US economy will not experience prosperity, but it will not collapse completely either. The EU is making progress, but cannot solve all problems within a few months. Although global investors may reconsider where to allocate funds, they will not abandon US assets. Artificial intelligence will not control the world tomorrow, but it will not disappear either. Diverse Choices Taking a middle ground does not mean lacking in convictions. Because by definition, extreme situations are unlikely to occur - usually the outcome will be decent, not extremely good or bad. That's why the bank still believes that higher quality assets (which have proven their resilience in various macroeconomic environments) should form the cornerstone of any carefully constructed portfolio. In addition, there are plenty of short-term opportunities. Whether it's realigning regional allocations, taking advantage of rising yields, or improving diversification through non-correlated strategies, the unclear consensus means investors have many choices.