The scars of the Covid-19 pandemic have not healed yet and, like it or not, continue to chart the course of the global economy. For the next year, for example, the analysts of JP Morganwait for the already announced recessionbut they suggest that, finally, there will be a stabilization of the markets, while economic growth shows a slowdown.
Additionally, as they highlighted, the “good news” is that central bank rates will have to stop raising, so inflation “will probably fall.”
Continuing on the positive line, the firm’s projections suggest that it will be a historic year in terms of stocks and bonds.
“Precisely because markets are so battered, lower capital valuations and higher bond yields, in our opinion, mean that investors now enjoy the most attractive entry point for a traditional portfolio in more than a decade,” the document from the executive said. american bank.
Regarding bonds, they pointed out that basic fixed income will offer potential for protection, yield and capital appreciation. What will mark a strong return.
And on the stock side, JP says he would expect mega-cap tech stocks to underperform and small-cap stocks to outperform.
There will also be a stabilization in terms of employment. Well, for example, in the United States, although employment growth would have healthy figures, the firm says that the labor demand it may have already reached its peak. With what unemployment could increase again next year.
“More companies are likely to freeze hiring or lay off workers to cut costs. As some such as Amazon, Peloton and Meta have already donewhich at the time were the favorites during the distancing, ”says the document.
Another point that will mark next year, for analysts, is the true lag of physical currencies or “real money”, as they point out that “The era of underinvestment in the real economy is over.”
Whatever events come during the next year, the outlook, perhaps, is more encouraging than what 2022 was for investors. Well, according to the firm’s report, this was one of the worst years for those who sought to have a balanced portfolio.
“Most of the things that could have gone wrong for investors happened in 2022. Markets that entered the year with extended valuations stuck in a inflation high, aggressive rate hike cycle globally, war in Ukraine, economic challenges in China. Both stocks and bonds suffered heavy losses,” they stressed.