As we closed the book on 2020, we bid farewell to a year that saw the world’s financial markets experience historic setbacks and furious rallies. Similarly, the economy posted a breathtaking plunge, followed by a monumental surge.
As 2021 dawned, the rollout of vaccines to battle COVID-19 and a fresh infusion of stimulus funds fueled investor enthusiasm. The Federal Reserve reiterated its pledge to backstop the economy as needed but uncertainties lingered around the pandemic’s course and how new leadership in Washington would steer the economy through the recovery.
To provide perspective for the year ahead, BOK Financial’s investment management team recently sat down to discuss key issues around the economy and financial markets, and offer their insights into ongoing investment considerations.
Catalysts abound for sustained economic growth.
Having saved $1T, immunized consumer will be ready to spend.
Equities still most attractive option in a richly valued market.
We’re optimistic that the U.S. economy will rebound at a 5.0% clip in 2021, driven by three key trends:
The pandemic-driven recession was unique in its depth and duration, yet its recovery primed most households for a robust 2021, featuring:
Although some have voiced concerns that the market is overheated and we’re closer to a drop-off than further gains, it’s important to remember that:
The Federal Reserve responded remarkably at the pandemic’s onset to keep the credit markets functioning, employing tactics and programs that sparked a bond market rally in the second half of 2020. It followed up by confirming that it will remain accommodative in 2021 as:
The 2020 pandemic relief bills provided a valuable bridge for millions contending with the abrupt shutdown of the economy, although many workers in the hospitality, travel and other service industries continue to suffer. Lawmakers are weighing further fiscal aid in 2021, but before they take bold action we hope that they fully account for:
It’s hard to understate the economic impact of the COVID-19 vaccines, which we believe will unleash pent up demand as consumers:
With Operation Warp Speed underway, this exceptional collaboration between the federal government and the pharmaceutical industry will help accelerate broad immunization efforts capitalizing on:
Surveys show that Americans are gradually warming to getting immunized against COVID-19, which is essential to supporting economic growth as it:
On the heels of the impressive rally of 2020, stocks kicked off 2021 trading at price-to-earnings multiples not seen since 2000. Unlike that year, however, we see the stock market pushing higher as it allows for:
Ensuring that portfolios are well-diversified in developed and emerging markets around the globe seems wise in 2021 as such assets are poised to benefit from:
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