World’s Top Money Managers See Global Equity Recovery in 2023

(Bloomberg) — Some of the world’s biggest investors are predicting stocks will see low double-digit gains next year, but the path to the rebound won’t be a straight line.

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Amid recent optimism that inflation has peaked and the Federal Reserve may soon begin to change its tone, 71% of respondents to a Bloomberg News survey expect stocks to rise, compared with 19% who predicted a decline.

The informal survey of 134 fund managers combines the views of major investors including BlackRock Inc., Goldman Sachs Asset Management and Amundi SA and was conducted between Nov. 29 and Dec. 7. In 2023, the Ukraine war and hawkish central banks grappling with inflation have crushed capital gains this year.

A similar survey last year predicted that aggressive policy tightening by central banks would be the biggest threat to stocks in 2022.

Here are the highlights of the survey in six charts. Click here for more information on the full details of the survey.

Modest Earnings

Those who expect global stocks to rise will see an average gain of 10% for 2023. That’s in line with the average historical return of the MSCI All-Country World Index, but looks modest given previous rebounds like 2009 or 2019, when stocks gained more value than before. 30% and 20% respectively.

Investors remain cautious for the start of the year and predict that stock returns will tilt towards the second half of 2023. When it came to specific sectors, respondents generally favored companies that could protect their earnings during an economic downturn. Dividend payers and insurance, healthcare and low-volatility stocks were among their picks.

The Biggest Risks

The biggest threats to a potential recovery are somewhat tied to stubbornly high inflation or a deep recession, which are high on investors’ watch lists, cited by 48% and 45% of participants, respectively.

Investors may expect a frenzy of headline risks early next week, including November US consumer price data, as well as rate decisions and comments from the Federal Reserve and the European Central Bank.

Read more: Stock Market Stress Creeps Again as Fed, CPI Data Loom

Tech Rebound

U.S. tech stocks, which took a hit this year, could also return to favor as interest rates rise, according to the survey. More than half of the respondents said they would buy the sector.

On the plus side, note valuations are relatively cheap, despite the recent rally and the fact that bond yields will fall next year. However, sentiment is moving away from a broad “buy growth” approach, as many participants suggest being very selective when returning to the segment, investing only in companies that have built business models and solid financial systems even in an economic downturn.

The Chinese opportunity

About 60% of investors are bullish on China, especially as Covid moves away from zero. The decline earlier this year has pushed valuations well below their 20-year average, making them more attractive than their US or European peers.

The political and regulatory risks are too great for those who recommend staying away from the region. Similar to big tech, bulls suggest being very selective when it comes to picking stocks.


For fund managers, better news on inflation and growth could be a catalyst for stronger performance. Almost 70% of respondents said that they are the main potential positive factors. They also cited the full reopening of China and the ceasefire in Ukraine as negative triggers.

The emphasis on inflation and growth as make-or-break elements is consistent with the results of Bank of America Corp.’s latest fund manager survey. It showed recession expectations were at their highest since April 2020, while the consensus view of a “stagflation” scenario of low growth and high inflation was “too big.”

The opposite view

The constructive view of money managers is at odds with what Wall Street is predicting. Separate Bloomberg surveys of strategists forecast a gain of less than 2% for Europe and a meager 1% for the US stock market.

Aggressive monetary policy by central banks, leading to a slowdown in global growth in the first half of 2023, is one of the main arguments that strategists have made to expect an essentially flat stock market next year. However, they predict that the impact on stocks will be partially offset by a decline in real bond yields.

Read more: Burnt Stock Market Experts Take Two Decades Out of Throat

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