This month’s contribution from Eurizon Asset Management appears in our Portfólió-ajánlók series, where we ask domestic asset managers how they would construct a medium-risk, medium-term model portfolio. Eurizon’s note reviews recent market drivers and sets out how they would position the model portfolio today.
The firm revisits two key influences it discussed last month: the Iranian-related tensions and the rapid advance of artificial intelligence (AI). While Eurizon judges both topics remain important, their market impact has shifted. The firm says the situation around Iran has eased enough that the Hormuz Strait has become more reliably navigable, contributing to lower oil prices and reduced inflationary pressures. As a result, Eurizon describes the global interest-rate environment as “clearly more supportive” than it was a month ago.
Eurizon also departs from consensus views by not anticipating further tightening from the Federal Reserve (Fed) this year, and by viewing any additional rate hike from the European Central Bank (ECB) as uncertain. These rate expectations feed into their decision to shift bond exposure toward international instruments.
On equities, Eurizon notes that AI has been the primary engine of recent equity gains, but signals of hesitation have emerged. High-profile developments — IPO announcements, implementations or delays (the firm cites SpaceX and OpenAI as examples), and corporate earnings such as Micron’s — have heightened investor sensitivity. After a prolonged rally, equity prices are now moving more volatilely and have shown a tendency to decline.
The firm attributes rising volatility to uncertainty over whether AI represents the start of a sustainable structural growth cycle or a precursor to a dotcom-style bust. Eurizon acknowledges it cannot provide a definitive answer; both dynamics could be present: AI may be initiating a broader growth phase while simultaneously creating local bubbles.
Accordingly, Eurizon recommends caution around AI-driven exposure but does not advocate blanket risk reduction in equities. Their preferred approach is rotation — reallocating within and across sectors — rather than moving large weights out of equities into other asset classes. In contrast, for fixed income they recommend increasing international weightings, chiefly due to improving international conditions.
Currency exposures and allocation
Eurizon’s stated current currency exposures for their model portfolio are:
- HUF exposure: 29%
- EUR exposure: 18%
- USD exposure: 44%
- Other currencies: 9%
The firm notes that the asset allocation is for informational purposes only. This write-up does not constitute investment advice or a recommendation.
Legal note: detailed legal information and disclaimers are provided in the original communication.
Tags: European Central Bank, Fed, artificial intelligence, oil price, equity market, Hormuz Strait, interest-rate environment, Portfólió-ajánlók, model portfolio, Eurizon Asset Management Hungary
