Dave Lafferty of Natixis Investment Managers expects a further weakening of the equity markets. He sees the reason in the extreme strain on the real economy – investors should therefore remain cautious.
Dave Lafferty, who acts as chief strategy officer at Natixis Investment Managers, has an important recommendation for investors who are once again focusing more on equities: market prices should fall again, as the recovery to date is only fragile. If we look at developments on a historical scale, the Corona crisis was the most severe blow the global economy has suffered. And it is unlikely that the markets have digested it within a few weeks.
In his opinion, market participants are still underestimating the extent of the consequences of the global lockdown – even if the stock markets have already returned to their February highs, up to 20 percent. The breakthrough is still far from being achieved – neither in the medical, political nor economic sector. The second or even a third major pandemic wave is not unlikely. The central banks, on the other hand, are not solving any problems, but merely calming the situation, while the economy is by no means out of the woods. As a result, Lafferty sees increasing volatility, which must naturally lead to greater losses.
His forecast: „Based on the current data, the potential for disappointment among investors will be greater than is the case for optimistic scenarios.”
Source: click here.