2019 may well bring trends that surprise us on the upside
While global growth is slowing, the pessimism that gripped markets in 2018 may lift during the course of this year
Looking ahead to 2019 the base case is that while the global economy will slow, a recession will be avoided. Many factors – including a strong labour market in the US, and fiscal boosts in China and elsewhere – will underpin earnings.
After the extreme negativity of markets in late 2018, we may see a recovery in share prices as several of investors’ worst fears fail to materialise.
At current levels we think markets are pricing in a recession scenario – which we see as extremely pessimistic and unfounded.