Bloomberg Intelligence's 'Equity Market Minute' 10/15/2021

Gina Martin Adams discusses the current state of global equity markets, noting that while prospects are not as bright as a year ago, the global fair value model suggests above-average returns. The model, which includes US, European, and emerging market data, indicates potential 8% returns despite challenges like slowing earnings growth and inflation. Valuations, though high in absolute terms, are favorable compared to bond markets. The equity risk premium has improved, enhancing global valuations.

What does the global fair value model suggest about future returns?

• Negative returns

• No change in returns

• Above average returns

• Below average returns

Which factors are expected to challenge global stocks in the coming year?

• Political stability

• Earnings growth slowdown and inflation

• Rapid technological advancements

• Decreasing consumer demand

What is the expected earnings growth for 2022 according to the model?

• Above average

• Average

• Below average

• No growth

How do absolute valuations for equities compare to bond markets?

• Equities are lower

• Equities are higher

• Equities are the same

• Equities are not comparable

What change has occurred in the equity risk premium over the summer?

• It became irrelevant

• It moved above the long-term average

• It remained unchanged

• It decreased below the long-term average