Julius Baer is increasing its investments of stocks likely to benefit from a cyclical upturn and reducing exposure to more “defensive” equities, and also regards commodities and corporate bonds as relatively attractive assets.

However, the Swiss private bank is not yet ready to take an overweight stance on equities as it wants to see clearer evidence of an economic recovery before pulling the trigger.

In a note on investment strategy, Matthias Ramser, head of multi-asset-class solutions, said: “Cyclical recovery and appealing valuations present an attractive environment for investments in equities, commodities and corporate bonds.” He continued: “We maintain our neutral weighting in equities, and await further confirmation of improvement in the economic scenario.”

His colleague, Bernard Urech, head of fixed income interest rates, said he expects interest rate and credit markets to show some “consolidation” after what has been a steepening of bond market yield curves in the wake of sharp interest rate cuts by central banks.

He said inflation-linked bonds continue to offer relatively cheap and low-volatility protection against inflation.