{"id":402241,"date":"2020-12-17T14:51:54","date_gmt":"2020-12-17T19:51:54","guid":{"rendered":"http:\/\/www.marketnewsdesk.com\/?p=402241"},"modified":"2020-12-17T14:51:54","modified_gmt":"2020-12-17T19:51:54","slug":"bmo-global-asset-management-2021-outlook-report-better-times-ahead","status":"publish","type":"post","link":"https:\/\/www.marketnewsdesk.com\/index.php\/bmo-global-asset-management-2021-outlook-report-better-times-ahead\/","title":{"rendered":"BMO Global Asset Management 2021 Outlook Report: Better Times Ahead"},"content":{"rendered":"
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Canada NewsWire<\/p>\n<\/p><\/div>\n

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\n TORONTO<\/span>, Dec. 17, 2020<\/span> \/CNW\/ – Following the global challenges experienced in 2020, the current optimism is expected to carry into 2021 as economic conditions continue to improve, according to BMO Global Asset Management’s (BMO GAM) Multi-Asset Solutions Team’s 2021 outlook report titled The Great Normalization<\/i>.\u00a0\u00a0 <\/p>\n

With rapid vaccination expected to take place in the first half of the year, the stage is set for strong growth recovery in 2021.The services sector should be a principal beneficiary as the in-person economy returns in the post-pandemic world. Additionally, fiscal and monetary support, which was crucial to economies and markets in 2020, is expected to continue into the new year. Absolute rates are also expected to remain at historic lows, leading to an environment supportive for equities and broader risk markets globally.<\/p>\n

“By mid-year we expect certain sectors, such as travel and tourism, to bump against capacity constraints as long-delayed holidays and other spending materialize,” said Frederick Demers<\/span>, Director, Multi-Asset Solutions, BMO Global Asset Management. “As normalcy returns, consumer spending is expected to grow and unemployment rates to be meaningfully lower than current rates. Heading into 2021, we are optimistic we will see improved economic conditions and better times ahead.”<\/p>\n

\n Canadian and U.S. Outlook
<\/b>The Canadian economy has recovered in recent months as a result of an aggressive fiscal response; however, it is expected to lag behind the U.S. and global recovery. The fiscal response has led to a surge in debt, with the federal deficit expected to exceed C$150 billion<\/span> for FY-2021\/22 as support for health, wage and income support programs continue. <\/p>\n

The U.S. economy and financial markets are expected to perform well on fiscal, monetary and vaccine developments. The Federal Reserve’s “average inflation targeting” approach will mitigate pre-emptive tightening on inflation pressures and interest rate increases. There are questions around equity market valuations; however, BMO GAM’s long-term valuation modeling indicates that equities are reasonably priced at current levels.<\/p>\n

\n Equity Outlook
<\/b>There is a favorable medium-term view on equities heading into 2021 given expectations for a vaccine-driven economic recovery and revitalized global corporate earnings. Current positioning includes: <\/p>\n