2021 Stock Market Outlook: Opportunities Outweigh Threats

WikiFX News (10 Feb.)-Strategists believe that global stock markets appear set on rising into 2021 - a year expected to see more opportunities than risks, attributed to the vaccine rollout and economic recovery.

Several institutional investors have bet that major stock indices in 2021 will not rise sharply, despite the bullish US stock market. Wall Street is expected to embrace a reversal in the first half of 2021, according to a market research institute in the US.

The German stock index DAX is projected to hit 14,000, and the Euro Stoxx 50 index, which covers 50 blue-chip stocks in the eurozone, will reach 3,500, Deutsche Bank said in a recent report. Goldman Sachs predicted a bullish FTSE 100, with the index rising to 7,200 by the end of 2021.

Asian stocks are set to outperform US markets for effective prevention and control of Covid-19 in the region. The Japanese yen may move higher in 2021 amid the intensifying deflationary pressures and the weakening dollar, said most Japanese media and experts. At the same time, the Japanese stock market is likely to keep in step with the yens growth.

The US-based Prudential Financial said it remained bullish on emerging markets. Some analysts believed that the Brazilian market was recovering to pre-pandemic levels, despite shocks of the infections in the bloc and the soaring unemployment in the US.

To a large degree, economic conditions and financial markets in 2021 will be decided by the status of the pandemic, said Deutsche Bank. It believed opportunities would outweigh threats, showing hopes of the rebound in tourism, industry, automotive, metals, mining, and other cyclical stocks that heavily affected by the pandemic.

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