A rallying call for investors has been sounded by the CEO and founder of one of the world’s largest independent financial advisory, asset management and fintech organisations. It comes from Nigel Green of deVere Group as global markets have got off to a confident start to the year. The MSCI gauge – the global stock market index – has rallied 9% so far this year after slumping nearly 20% in 2022.
Green notes: “The re-opening of China, weaker gas prices, and growing signs of a ‘soft landing’ for the U.S. economy as it appears that the Federal Reserve is reducing inflation without creating significant unemployment, are amongst the factors which have improved the outlook for global markets. This is causing a bullish sentiment as investors believe that many of 2022’s headwinds are now in the rear-view mirror. The worry over corporate earnings in the first half of 2023 is a near-term concern, but one that investors appear reasonably happy to look beyond.”
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“Investors are looking ahead to the second half of the year, and to a global economic recovery underlined by an end to interest rate hikes from the major central banks by mid-summer, and possibly rate cuts at the end of the year as inflation falls sharply on a year-on-year basis,” adds Green.
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Market volatility in recent times has lowered valuations of some high-quality equities. This, says Nigel Green, will now be being used by savvy investors “to create better long-term investment opportunities and generate higher income for investors. They will be currently viewing this backdrop as a buying opportunity to top-up their portfolios.
“Inflation will still be an issue for a while to come, but less so as we move through the year. But it is likely that investors will be seeking to increase exposure to growth stocks, especially the currently undervalued ones, as cost of living eases and global growth picks up momentum,” says Green.
The deVere CEO concludes: “With a better year already underway way and the market currently low, investors should be positioning portfolios to take advantage of a brighter outlook. Many will be moving fast, so as not to miss the opportunities.”