Al-Eqtisadiah from Riyadh
Strategists at "City" expected that global equities would go public, recommending possession of a relatively safe equity portfolio to guard against the consequences of the emerging Corona Virus pandemic.
According to "Reuters", shares in "City" recommended customers to avoid the risk of retaining American stocks and shares of health care companies, and reduce their exposure to bank shares, as profits will likely take time to recover from the repercussions of the pandemic.
In a note released yesterday, they said, "The upward impulse will likely cancel global $ 6 trillion in QE policies following the downward pressure caused by the general shutdown measures."
And "City" stressed that financial institutions will face difficulties due to an extended decline in interest rates, and therefore it is preferable to avoid them and hold relatively safe shares such as health care companies.
The restrictions and measures imposed to contain the spread of the virus have caused serious damage to economic activities and the demand for high-risk assets during the past months, but this effect has been fairly offset by massive asset purchases by central banks, which have boosted confidence.
Experts said, "We do not expect markets to rise above current levels."
The memo predicts that the Standard & Poor's 500 Index will be at 3,160 points in the middle of 2021, which is just 1 percent more than last Friday's close. And I expect the stock exchanges in Australia, Europe, and Japan to perform with the same stability.
This forecast is generally consistent with last week's HSBC private banking activity but is somewhat more pessimistic than Credit Suisse's view, which was a slightly more positive outlook for equity markets.
