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INVESTMENT INSIGHTS  |  January 2015  |  FEATURING Rob Lovelace

The Future Looks Bright

Flying cars? No, sorry. Hoverboards? Probably not, although there is progress on that front. The future, it seems, isn’t going to be filled with all the fantastic things people have dreamed up. But it is going to be remarkable.

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INVESTMENT INSIGHTS  |  April 2014  |  FEATURING Brad Barrett

Going Mobile: “M-commerce” Drives E-commerce Higher

Sources: International Strategy & Investment, United States Census Bureau and comScore, Inc. Figures for e-commerce sales exclude autos, gas and restaurants.

A disruptive force and opportunity, smartphones boost online sales

  • For many people around the world shopping now means going online as well as going to the store. The acceleration of e-commerce during the past few years has been rapid and dramatic.

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INVESTMENT INSIGHTS  |  April 2014  |  FEATURING Rob Lovelace

A New Revolution

There are periods of fundamental change that can transform the way we live and work. The Industrial Revolution, of course, changed everything from agriculture to the social structure, effectively ending the way mankind had functioned for thousands of years.

Today it seems as if we are in the middle of another revolution, and clearly these changes pose significant challenges and opportunities for long-term investors.

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MARKET COMMENTARY  |  Fri Mar 07 12:59:19 PST 2014

Long-Term Global Financial Impact of Ukraine Crisis Expected to Be Limited

  • Ukraine is facing significant political and financial challenges amid a fragile economic backdrop and twin deficits. Investors should expect elevated market and currency volatility.
  • The political situation is fluid. Currently, we anticipate that the longer term impact on global equity and bond markets should be limited. Similarly, there appears to be only a relatively small risk of significant contagion spreading to other developing economies.
  • Russian economic growth could decelerate further, which may pressure company earnings and lead to a moderately deteriorating credit situation. That said, Russia’s overall financial metrics remain sound and arguably a significant degree of uncertainty is reflected in Russian debt prices.

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INVESTMENT INSIGHTS  |  February 2014  |  FEATURING Mark Denning

Welcome to the New Geography of Investing

* Source: MSCI Economic Exposure Analysis. As of June 30, 2013.

Over the past 40 years, the global economy has become increasingly interdependent. Free trade agreements, the European Union, economic reforms and the rise of a middle class in developing economies has allowed companies to compete for customers, labor, capital and natural resources on a global basis.

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INVESTMENT INSIGHTS  |  February 2014  |  FEATURING Eu-Gene Cheah

A Prescription for Innovation

The 39 New Drugs Approved in 2012 Represented the Most Approved in More Than a Decade

Most of the drugs are “first-in-class,” meaning they use new and unique ways for treating a medical condition.

Source: U.S. Food and Drug Administration (FDA). Innovative drugs represent new molecular entities, which are novel new medicines or active ingredients that have never before been marketed in the United States in any form, as approved by the Center for Drug Evaluation and Research, a division of the FDA. The number of drugs approved for 2013 is as of October 8, 2013.

In the world of pharmaceuticals, new drugs are known as NMEs, or new molecular entities. In 2012, the Center for Drug Evaluation and Research, a federal agency, approved 39 NMEs, the highest total in more than a decade.

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INVESTMENT INSIGHTS  |  February 2014  |  FEATURING Claudia P. Huntington

Follow the Money, Not Just the Mail

Look Beyond Europe-Domiciled Companies

Revenues by region

Source: MSCI Economic Exposure Analysis-Security Report. As of June 30, 2013.

Connecticut isn’t the first place you think of when investing in an economic recovery in Europe. But could a New England-based online travel company really be more closely connected to an economic recovery in Europe than the continent’s largest companies?

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INVESTMENT INSIGHTS  |  February 2014  |  FEATURING Steve Watson & Claudia P. Huntington

The Developed World Regains Balance

Balancing Act: The Engines of the Global Economy May Be in the Process of Trading Places

Source: Bloomberg © 2013. Used with permission of Bloomberg. Calendar-year consensus estimates for 2013 represent year-to-date data, as of September 2013; therefore, full-year estimates may not match the trend for the remainder of 2013

Maybe the developed world isn’t quite ready to be put out to pasture after all. Suddenly, the United States seems to be feeling spry, Japan is shaking off the doldrums and Europe has a little bit of spring in its step.

Indeed, there are signs of stability and strength on a variety of fronts for all three of the old-school engines of the global economy. The advances may be gradual and fitful, but they are nonetheless reassuring evidence of the adaptability and vitality of the world’s largest developed economies.

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Develop a New Perspective for Portfolio Construction

Rising incomes have introduced emerging markets consumers to a wide variety of luxuries common in the developed world, from better education and health care to smart phones and luxury automobiles. But developing nations have also increasingly adopted Western lifestyles and diets, predisposing large portions of their population to a serious epidemic: Type 2 diabetes.

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MARKET COMMENTARY  |  January 2014

World Markets Review for Fourth Quarter 2013

Stocks ended the year with strong gains in developed economies, reaching historic highs in several key markets. Central bank stimulus, an accelerating U.S. economy, and improved corporate earnings supported higher valuations in the U.S, Europe and much of Asia. Emerging markets trailed developed markets, hampered by concerns about U.S. monetary policy. Information technology stocks rallied around the world, while rising interest rates weighed on the utilities sector. U.S. Treasury bonds declined as rates reached a high point for the year and investors moved out of safe-haven assets. The dollar fell 2% against the euro but rallied 7% versus the yen.

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January 2014
 |  FEATURING James F. Rothenberg

China’s Future Growth May Depend on Others’ Strength

American Funds Portfolio Manager Jim Rothenberg discusses the reliance of China’s future growth on the strength of the overall global economy, despite a rise in Chinese domestic consumption.

Watch Video (1:30)

January 2014
 |  FEATURING James F. Rothenberg

Companies Succeeding Globally, Despite Macro Headwinds

American Funds Portfolio Manager Jim Rothenberg discusses the health of companies based around the globe and finds reasons for optimism, as well as some concerns, going into 2014.

Watch Video (2:05)

January 2014
 |  FEATURING James F. Rothenberg

U.S. Leading Global Economic Charge Into 2014

American Funds Portfolio Manager Jim Rothenberg discusses the unexpected strength of the U.S. market in 2013, how it led activity in the global economy and how the U.S. and global economies will influence each other in 2014.

Watch Video (2:21)

MARKET COMMENTARY  |  January 2014

World Markets Review for 2013

Stocks enjoyed a strong rally in developed markets, supported by central bank stimulus, improving economic activity and reasonably good earnings growth. Emerging markets equities and most fixed-income markets declined as the U.S. Federal Reserve contemplated and later implemented a reduction in its massive bond-buying programs known as quantitative easing. The Fed action drove interest rates higher, pressuring bond markets and reducing demand for higher risk assets. Gold and silver prices plummeted as concerns about inflation waned.

Most sectors enjoyed double-digit gains for the year, led by consumer discretionary and health care stocks. Telecommunication services stocks advanced amid resurgent M&A activity. Corporate bond issuance soared as companies sought to lock in low borrowing costs. The year closed on a positive note as several key stock market indices reached all-time highs in December. U.S. equities rose 32%, the largest gain since 1997.

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