Fall Brings Cooler Perspectives
Fall is officially upon us, and with it hopefully some sense of normalcy in a year that has been anything but. The leaves will turn colors, the mosquitos will retreat, and cooler temperatures will prevail. We also believe that the fall will bring cooler perspectives on the economy and markets.
- The global economy rebounded sharply in the third quarter, but it should be a slower recovery going forward.
- The S&P 500 has hit new highs since bottoming in March, but high valuations are now posing volatility risks to stocks.
- Bond markets also have their own risks, with yields at very low levels and high-yield markets not fully pricing in potential bankruptcies.
- The worst of the COVID-19-related downturn appears to be over, but a continued recovery will see ups and downs, and slower growth can be expected.
- Broad diversification in both equity and bonds is prudent, as is a focus on long-term objectives and not getting caught up in day-to-day fluctuations and noise.
CIM Quarterly Market Outlook Q4 2020.pdf
The Market Outlook is published by Cetera Investment Management LLC, an SEC registered adviser owned by Cetera Financial Group. Cetera Investment Management provides market perspectives, portfolio guidance, model management, and other investment advice to its affiliated broker-dealers, dually registered broker-dealers and registered investment advisers.