At Barclays Wealth, Chief Investment Officer Aaron S. Gurwitz sees steady improvements in global economic news and positive surprises in statistics.

He isn’t worried, he says, unless political unrest spreads to a major oil producer. The group also believes that higher interest rates shouldn’t push stocks down and are still months away. There are good buys in U.S. and continental Europe stocks, especially in energy and technology, and price to earnings ratios are lower today than at the start of 2010 because of earnings growth.

To hedge against Middle East unrest, Barclays says, advisors should choose options that benefit from higher energy prices or more stock volatility.

Asia, particularly China, Taiwan and South Korea, remains Barclay Wealth’s favorite emerging market region because of its fast growth, more diversified markets and better corporate and political governance. The group expects China will continue to see 7% growth in GDP and its stocks are well-priced.  China’s growth has been driven by the government’s five-year plans, which is currently focused on developing domestic demand for biotechnology, new energy sources, and new energy cars.

As for bonds, the group favors high-yield and emerging markets, which offer 7% yield and will benefit as companies become more credit worthy. However, the group is holding high quality U.S. government bonds as portfolio insurance.  

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