J.P. Morgan Asset Management explores how unprecedented central bank stimulus and rising anti establishment politics reshaped markets entering 2017. The outlook suggests investors may be underestimating inflation, protectionism, and policy risk even as global business surveys pointed toward 3% GDP growth and recovering corporate profits.
Eye on the Market Outlook 2017
J.P. Morgan Asset Management
Michael Cembalest
Research
46 Pages
Key Takeaways
Central Bank Distortions: More than $11 trillion in bond purchases pushed large portions of global sovereign debt below 0% yields, hurting European and Japanese bank earnings and equity performance.
Muted Return Expectations: Diversified portfolios returned 1%-3% in 2015 and 6%-7% in 2016, with the outlook projecting another single digit return environment during 2017.
Protectionism Rising Globally: Discriminatory trade measures climbed from roughly 200 in 2009 to nearly 800 by 2015, reflecting mounting political backlash against globalization and weak productivity growth.
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