“Stock Bulls are set to get another big uplift, as there more demand and less supply” — Paul Ebeling
So say the global market strategists at JPMorgan Chase & Co. (NYSE:JPM) as they expect a rise in equity demand of about $600-B relative to this yr.
Meanwhile, supply will drop by $500-B, returning to the very low levels of Ys 2016 to 2018, the strategists wrote in a note to clients Wednesday.
“This is similar to the equivalent equity demand/supply improvement in 2019 relative to 2018 which at the time had seen global equities rising by around 25%,” JPMorgan said.
The biggest slice of the higher demand is seen coming from retail investors and older cohorts “are abandoning their previous cautious stance,” based on the evidence in November, JPMorgan said.
Analysts see retail inflows of about $40-B a month for Y 2021, about the historical average.
Sovereign wealth funds and central banks may be “modest” equity buyers and so-called risk parity funds, might want to increase their exposure after a decline in Y 2020.
At the same time, supply will be cut by a normalization of leveraged buyouts and share buybacks and a slowing need for equity raising, JPMorgan said.
Have a healthy day, Keep the Faith!