Markets – The Big Picture, 2020 vs. 2021 2020 is the year of the coronavirus, a lockdown, a recession, which is bullish for Wall Street. 2021 will see a vaccine, a reopening, a recovery, which is bearish for Wall Street. Image: BofA Global Investment Strategy
Global (Equity + Bond) Total Returns Relative to GDP This week, the coronavirus vaccine news sent financial markets to the moon. Image: BofA Global Research
Health Care Stocks – Health Care Sector Excess Returns vs. S&P 500 Around U.S. Presidential Elections The health care sector tends to outperform after Election Day. Image: Goldman Sachs Global Investment Research
Valuation – U.S. Equities vs. Other Markets Is the U.S. stock market too expensive vs. other markets? Image: Gavekal, Macrobond
Stocks – U.S. Equity Return Corresponding with 10 Percentage Point Increase in Probability of Vaccine Mass Distribution by Mid-2021 Value stocks tend to outperform when vaccine expectations improve. Image: Goldman Sachs Global Investment Research
Money Markets and Risk Assets Should investors expect more upside for stocks, as a wall of money supports risk assets? Image: BofA Global Research
China vs. U.S. – Projected GDP China is expected to overtake the United States as the world’s largest economy in the near future. Image: Morgan Stanley Wealth Management
Distribution of S&P 500 Calendar Year Returns Goldman Sachs forecasts S&P 500 will climb by 16% to 4,300 by the end of 2021. Image: Goldman Sachs Global Investment Research
Stocks – U.S 10-Year Treasury Yield and NYSE FANG+ Index The jump in long bond yields could be a game changer for long duration stocks. Image: Alpine Macro
U.S. Interest Rates – Velocity of MZM Money Stock and Natural Rate of Interest Should investors expect low interest rates for a long period of time? This chart helps to explain the secular trend for U.S. interest rates. Image: Fidelity Investments
U.S. Government Spending as % of GDP The fastest fiscal contraction looms. Image: BofA Research Investment Committee