With 2020 quickly coming to a close, investors are wondering what lies ahead for the equity markets in the last few months of the year. The year has been a tumultuous one, to say the least, with global markets experiencing major swings due to the pandemic. With no clear end in sight, and no vaccine yet available to combat the virus, the uncertainty that has plagued the markets in 2020 is expected to linger.
At the start of the year, many experts predicted a strong return for the equity markets, fueled in part by a continued strong economy and record-low unemployment rates. However, the onset of the pandemic changed everything, as major economies began to struggle and companies around the world were forced to shut down operations. Despite this, the markets have been resilient, and in many cases have recovered to pre-pandemic levels.
Looking ahead, the outlook for the equity markets in 2021 is difficult to predict, due in large part to the uncertainty surrounding the pandemic. The pace of recovery will depend on factors such as the speed of the vaccine roll-out and the success of government stimulus programs. It is likely that the economic impact of the pandemic will linger on well into next year, and many companies may struggle to regain their footing.
It is also possible that we could see another period of volatility in the markets, as investors may seek to take profits from recent stock market gains. Nevertheless, a wave of stimulus promises to provide security and support to markets, and investors may be more likely to take on additional risk in pursuit of potential returns.
Overall, the end of 2020 is likely to bring more of the same uncertainty and volatility that has characterized the year. As investors look ahead to 2021, it is important to have a well-thought-out and diversified portfolio that can withstand short-term market swings. Taking a long-term, patient approach to investing could be a key to success in the months and years to come.