Barclays with comments on the Federal Open Market Committee (FOMC) and equity markets for the year ahead.
Analysts at the banks say the market is correct in looking for rate cuts, but is too optimistic:
- “Although the rate cuts priced in the US look too aggressive to us absent a deep recession, we agree that the direction of travel is towards lower rates”
Analysts look for equities to see some upside in 2024, but limited gains:
- “We expect a higher, yet more sober, equity market in 2024.
- Post an exceptional year-end rally, the bar for positive surprises has been raised
- Cyclicals look toppish
- it’ll be a “healthy consolidation”
- better valuations and earnings could potentially add to some upside potential
Ps, speaking of equities, Japan’s Nikkei benchmark 225 has climbed above 35K, its highest since February 1990.