Global stock markets have been resistant to expectations of a gradual withdrawal of monetary stimulus and inflationary pressures, as major equity indices provide investors with new highs. But the stock’s immunity to interest rate hike fears may not last long, analysts at Bank of America Merrill Lynch warned.
Although investors expect that the US Federal Reserve, which meets until tomorrow, will announce at the end of the meeting the beginning of the gradual withdrawal of monetary stimulus, stock exchanges continue to rise, indifferent to the change in the monetary strategy of the state. Global power plants major banks.
While Wall Street hit new records earlier this week, France’s CAC-40 index in Europe is poised to end the session at record levels.
The optimism in stock markets was underpinned by the third-quarter earnings season, but Bank of America analysts warn that it is only a matter of time before stocks have to discount a more unfavorable environment in terms of monetary stimuli in a liquidity-addicted central bank market.
On the other hand, Goldman Sachs disagrees with Bank of America, and argues that stocks will continue to get support in the absence of alternatives, given the low interest rates on bonds. Strategic analysts at the Wall Street giant expect “healthy” levels of growth in the coming year, fostering a benign environment for stocks.
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