Despite the fall of 2022, the Barclays analysts believe global equity markets have room to fall further.
Cash should be the real winner of 2023
“We see that US stocks tend to bottom out 30-35% below their peak in the midst of a recession. That suggests a fair value of 3,200 on the S&P 500 sometime in the first half of 2023. European valuations look more reasonable, but this is offset by a considerably worse macroeconomic outlook than in the US.”
“Bonds have massively underperformed stocks in 2022, and our analysts now see limited downside travel in longer-term US fixed income. If we were forced to choose between stocks and bonds, we would overweight bonds. basic fixed income versus equities.”
“But cash should be the real winner of 2023, as US initial yields are likely to rise to 4.5% or higher and stay there for several quarters. The ability to make gains above 4% without assuming Virtually no risk is a factor that should weigh on both the equity and bond markets next year.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
