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Global Indexes Show Impressive Gains as Investors Look to International Markets
Global Indexes Follow U.S. Lead
As U.S. stocks continue to surge in 2021, international markets have followed suit. The MSCI World index saw gains of 14% in the year to date, while Japan's benchmark index, Nikkei 225, rose by nearly 31%. The Stoxx Europe 600 and Germany's Dax index also saw gains of 12% and 17%, respectively. With some analysts predicting international markets to perform better than the U.S. this year, Morgan Stanley's mid-year outlook report urged investors to "play offense" in Asian stocks.
Asian Equities Recommended for Strong Growth Potential
Morgan Stanley's report recommends overweighting Japanese and emerging market equities thanks to strong growth potential, easier policy, lower inflation, and reasonable valuations driving double-digit 12-month returns. J.P. Morgan Asset Management also suggests international diversification in developed markets such as Japan. Tai Hui, the chief market strategist for Asia-Pacific, noted that Japan is enjoying "structural tailwinds."
Quality Companies in the U.S. Still Good Investment Long-Term
However, analysts still believe in quality companies within the U.S. market. Tai Hui adds that investors should focus more on quality companies in the U.S. that would be more resilient in a weaker growth environment, as long-durational growth stocks could benefit from lower yields in the coming months. Quality companies in the U.S. remain highly attractive for long-term investments. These companies possess exceptional qualities such as robust fundamentals, visionary leadership, and proven performance records. Their ability to consistently generate revenue growth, offer dividends, and navigate market fluctuations make them ideal choices for investors seeking stability and potential returns. By investing in such companies, individuals can secure their financial future while benefiting from the resilience and adaptability of these trusted market players.
The Excitement Around Artificial Intelligence Stocks
Some analysts predict that artificial intelligence (A.I.) could give U.S. stocks a boost. The demand for A.I. is impressive, and demand is expected to continue. Raymond Bridges, managing director of investment management firm Bridges Capital, advises participating in individual names within this market. The excitement surrounding artificial intelligence (AI) stocks is justified. With AI revolutionizing industries like healthcare, finance, and retail, companies at the forefront of this technology offer immense growth potential. AI stocks provide investors with exposure to cutting-edge solutions that enhance efficiency, drive innovation, and improve decision-making. The scalability and cost-effectiveness of AI technologies further fuel investor enthusiasm. While investing in AI stocks carries risks and volatility, those with a long-term perspective and a desire for innovation can be part of a transformative wave that reshapes industries and yields substantial returns.
Potential Stocks to Watch
Stock screen CNBC Pro screened stocks in MSCI World, S&P 500, and the Vanguard FTSE All-World ex-U.S. Index Fund. The resulting stocks have buy ratings from over 65% of analysts covering them and an average price target upside of at least 30%. Coal mining company Yancoal Australia and Hong Kong-listed ESR Group both received 100% buy ratings from analysts and significant upside potential. Other stocks worth watching include Kansai Electric Power and JCR Pharmaceuticals in Japan and German-based company Hello Fresh. U.S. stocks to watch include MercadoLibre, Humana, and Jazz Pharmaceuticals.
As global indexes continue to show impressive gains and investors look to international markets, it is worth considering how this may impact a new business. With Morgan Stanley's mid-year outlook report urging investors to "play offense" in Asian stocks, Japanese and emerging market equities are recommended for strong growth potential. This could be an opportunity for a new business to explore these markets and potentially invest in quality companies with promising futures in these areas.
However, it's important to note that analysts still believe in quality companies within the U.S. market and as long-durational growth stocks could benefit from lower yields in the coming months, it may be worth keeping an eye on these stocks as well. Additionally, with the excitement around artificial intelligence (A.I.) stocks and their potential to give U.S. stocks a boost, a new business could potentially enter into this market by participating in individual names.
Overall, keeping an eye on potential stocks to watch in both the U.S. and international markets could be a wise move for a new business looking to invest in equities. With the right research and understanding of market trends, a new business could potentially capitalize on the gains seen in the global market and make solid investments for their future.
