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Now is not the time to sell stocks, JP Morgan strategist says
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Loading...Global investors should not be put off by current equity market valuations and now is not the time to "de-risk" portfolios, according to one global market strategist.
"Despite the strong rally, valuations have not changed much since the start of 2017 in Europe, U.K. and Japan, as earnings have grown strongly," Mike Bell, global market strategist at J.P. Morgan Asset Management, said in a new report Tuesday.
"It is only emerging markets and the U.S. which have seen valuations creep higher as share prices rose by more than earnings expectations. With emerging market valuations starting from a low base, only U.S. valuations look somewhat expensive compared with their long-run average," he added.
In the eyes of J.P. Morgan, a healthier U.S. labor market; easy credit conditions in Europe and data indicating further equity price gains in 2018 support the idea that there's further room to run in the stock market.
Bell from J.P. Morgan is confident on equities in 2018 as he believes the global economic picture looks healthier.
"To me the greatest risk is that we get a pick up in inflation that causes the Fed to over-tighten," Bell told CNBC Tuesday morning. He added: "Realistically I think it's pretty unlikely that you'll get enough of a tightening this year to cause problems."
Source: Bloomberg Pro Terminal
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