According to Bloomberg News, everything is taking shape as it should facilitate global gains in stocks this year, as per JPMorgan Chase & Co strategists. The company’s strategists led by Mislav Matejka stated in a note Tuesday that it is best to stay bullish as the positive catalysts have not been exhausted yet. They further went on to say that the downside risks that include the central bank’s hawkish twist, China’s economic slowdown, or restrictions related to coronavirus will either not materialize or will already be included in the stock pricing.
The positive outlook comes on close heels as the United States and Europe’s benchmark indexes have been found to trade at record highs, after last year’s rally alongside fiscal stimulus which was unprecedented and a remarkable rebound following a slump due to the pandemic.
Bloomberg News also states that the strategists at JPMorgan are not alone. Others of the same view include Credit Suisse Group AG reiterated a bullish outlook for US stocks and Societe Generale SA Tuesday echoed a similar sentiment with a forecast of 6.6% for the European stocks in the current year, saying that it is not the end of the bull market.
Goldman Sachs Group Inc and BlackRock Investment Institute strategists view an upside, however, at a muted pace.
Among the key calls made by JPMorgan are UK’s overweight position and equities belonging to the euro area, aside from autos, miners, and banks. With deceleration in China, these very strategists predict a good point of entry in the stocks of the emerging market. Reopening trade is also a possibility.
Bloomberg News reports that the experts suggest a neutral position related to the US stocks, stating that it is quite likely that these stocks might stall if tech outperformance starts waning. However, the overall picture appears to be positive for the equities, since inflation could surge in the first half of the year as the Fed is not likely to get hawkish, and the growth projections for consensus earnings might prove to be low again.
