Optimism abounds after a year dogged by US-China trade uncertainty and fears of a global recession. But, while the good news many had been waiting for materialised late in 2019, Brexit, US-China trade relations and the US elections are likely to throw up some challenges for the global economy, so caution and tempered optimism are called for as we watch how events unfold during 2020.
World investors are so buoyed by a turnaround in events leading into 2020 that financial markets are looking set to notch up their best returns in a decade. However, is such optimism justified given that there are so many unpredictable variables that will determine 2020’s economic outcome?
Much of what lies ahead calls for the adoption of a wait-and-see approach. There are three material events that will predominate: the progress of Brexit, US-China trade relations and the US elections.
The power of these seismic events to move markets and significantly alter the trajectory of financial markets and the global economy was clearly evident in 2019. With these events far from reaching their end games and so much good news priced in, asset class valuations and sentiment are even more vulnerable than in 2019 to any…
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