BENGALURU - Global stock markets are forecast to close the year below their pre-pandemic highs, but will still keep alive for at least another six months a bull run that is defying a sombre economic outlook across much of the world, Reuters polls of market experts found.
While the latest findings were slightly more upbeat than those taken three months ago, the outlook for stock markets from Asia to Europe to Americas has limited upside, if any, on weak corporate earnings and economic worries."Equity markets rebounded ... as this higher starting point represents a mismatch between equity prices and fundamentals, we expect this divergence to be gradually reflected in prices," noted Monica Defend, global head of research at Amundi Asset Management.
"Our view that equity prices will rise further is underpinned by our forecast that the global economy will continue to recover, even if more slowly and unevenly than during its initial bounce-back over the past few months, and that ample policy support will remain in place for as long as it is needed," said Simona Gambarini, markets economist at Capital Economics.
Despite the disconnect between US share prices and the economy, where unemployment has risen sharply as many states are still struggling to suppress the virus, the S&P 500 wiped out all of its 35 per cent loss and swiftly returned to a record high.