Outlook 2014: Are we in the eye of the storm?
More than four years into a stock market rally, our capital market strategists ask, “Can it last?”
- The economy: Signs of accelerating growth are evident
Except for China and some other emerging economies, we think the world will see accelerating growth in 2014—likely in a context of low inflation.
- Equities: Fundamentals remain in place
We believe that most, if not all, of the factors that were in place to drive the market higher a year ago are still in place and, in our opinion, should remain so over the next 12 months.
- Fixed income: Focus on income, not safety
Because we believe it is still too early in this investment cycle to employ defensive strategies, income—not safety—should, in our opinion, remain the primary investment objective in the year ahead.
Four pivotal points to turn your clients toward equities
- Company valuations are currently
- Emerging economies are positioned for
- Leading indicators signal continued
- A balanced portfolio has historically
helped drive returns.
Companies that return cash to shareholders seem poised for