■ We expect global equities to generate a total return of 9% in 2015. We forecast earnings growth of 12%, thus modest multiple contraction. Valuations are in line with historical norms, while bond yields should end the year higher. We calculate the long-term growth rate for earnings implied by current prices to be 1.5%, low by historical standards and below the run rate for global growth.

■ We recommend overweighting equities: with a 10% overweight position in Japanese equities and a 6% overweight position in Continental European equities. We think earnings growth will be strongest in Japan and Continental Europe, as both regions benefit from currency weakness. Against this, we recommend underweighting US equities and (developed) Pacific ex-Japan. Both regions look relatively expensive, the former compared with non-US stocks, the latter relative to emerging Asian markets. We have neutral recommendations in the UK and emerging markets.

■ We think cyclical sectors are underpriced and should benefit from stronger discretionary consumption and capex. Financials should do well as bond yields turn higher. Our largest overweight recommendations by global sector are Industrials, Financials and Consumer Discretionary. Our largest underweights are Healthcare and Consumer Staples, as the price paid for "quality" in non-US markets looks high.