2022 Outlook:Choose European Stocks and Resist Buying U.S. Stocks？

Molly wealth talk joined discussion · Nov 16, 2021 03:04

As 2021 drew to a close, I read many articles about 2022 outlook and would pick some interesting opinions to share with you.

That's the advice of Morgan Stanley's strategy team, which sees fading monetary support and high valuations holding back American assets in 2022, even as growth improves and inflation moderates.

Morgan Stanley thinks that Fundamentals are more attractive in Europe and Japan, where central bankers will be more patient and inflationary pressures are lower.European stocks, as represented by the MSCI European index, can deliver 8% price returns and Japan 12% price gains, according to the strategists.

2022 Outlook:Choose European Stocks and Resist Buying U.S. Stocks？

Source:Morgan Stanley

Morgan Stanley sees the $S&P 500 Index(.SPX.US)$ finishing 2022 at 4,400 -- some 6% below current levels. Its strategists are penciling in 10-year yields rising to 2.10% by the end of next year on improving growth.

It is different from the Goldman Sachs's prediction that S&P 500 price target would remains 4,900 by the end of 2022 -- about 5% up from current levels.

“We think that 2022 is really about 'mid to late-cycle' challenges: better growth squaring off against high valuations, tightening policy, rambunctious investor activity and inflation being higher than most investors are used to,” strategists led by Andrew Sheets wrote Sunday. “We see plenty of challenges, including downside to the S&P 500 and U.S. 10-year yields being well above forwards.”

$ProShares UltraPro Short Dow30 ETF(SDOW.US)$ $Nasdaq Composite Index(.IXIC.US)$ $Invesco QQQ Trust(QQQ.US)$ $Invesco Exchange Traded Fd Tr Ii Nasdaq Next Gen 100 Etf(QQQJ.US)$
$SPDR S&P 500 ETF(SPY.US)$

What do you think of Morgan Stanley 2022 recommendations?
Let's share your opinons!
If you have any suggestions, please tell me.

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