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Market Outlooks
Global Weekly Commentary: Valuation: not a worry for now
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Equity valuations have been top of mind after major stock indexes have scaled new highs. Last week’s volatile market moves as a result of technical deleveraging added fuel to these concerns. We do not see risk asset valuations as obviously stretched overall, and expect low interest rates – and a vaccine-led restart – to support risk assets over the next six to 12 months.
Market Outlooks
Global Weekly Commentary: The new nominal takes shape
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We have long flagged the potential for higher inflation in the medium term, and markets have awoken to this prospect amid expectations for large U.S. fiscal stimulus. We don’t see this derailing the risk asset rally in the near term.
Market Outlooks
Global Weekly Commentary: The new nominal, accelerated
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The Democrats’ newly gained majority in U.S. Congress paves the way for greater public spending but the narrow margin limits the scope for higher taxes, in our view. We expect this outcome to speed up “the new nominal”, or our expectations for stronger growth coupled with stable nominal yields, even as a more infectious virus strain threatens to make the path to a full activity restart more bumpy.
Market Outlooks
Global Weekly Commentary: Three investing lessons from 2020
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2020 was an extraordinary year for financial markets. The initial Covid shock triggered a massive selloff, followed by a risk rally that extended to the year end.
Market Outlooks
Global Weekly Commentary: Positioning for the new nominal
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A key consequence of this year’s policy revolution is the potential for a more muted response of nominal yields to higher inflation, in our view. This means investors should start positioning their long-term portfolios for this new dynamic now, in our view.
Market Outlooks
Global Weekly Commentary: Why we are turning bullish for 2021
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The expected widespread rollout of Covid-19 vaccines in 2021 has strengthened our conviction in an accelerated economic restart. We have turned more pro-risk, upgrading equities to a tactical overweight.
Market Outlooks
Global Weekly Commentary: Our latest credit views
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We have closed our tactical underweight in EM debt as easy monetary policy is expected to stay, against the background of an improved 2021 outlook. Positive news on Covid vaccine development has boosted the case for an accelerated global restart in 2021.