LPL MIDYEAR OUTLOOK 2021

 

 

Pick Up Speed for the Rest of 2021 with LPL Research’s Midyear Outlook

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Midyear Outlook 2021 launches today. While the speed can be exhilarating as economic growth accelerates, it can also be dangerous. Midyear Outlook 2021: Picking Up Speed is designed to help you navigate the risks and opportunities brought upon by the economy’s reopening for the rest of 2021 and beyond. View the interactive digital version here. The highlights in the report include:

  • Economy: Speeding Up. The country has reopened and there is still plenty of momentum to extend above-average growth into 2022. LPL researchers forecast 6.25 to 6.75 percent U.S. gross domestic product (GDP) growth in 2021, which would be the best year in decades.

 

  • Policy: Taking a Backseat. The economy was supported through the pandemic by more than $5 trillion in stimulus measures and extraordinary support by the Federal Reserve. Policy will take a back seat in 2021 as private sector growth replaces stimulus checks.

 

  • Stocks: Gaining Ground. Economic improvement should continue to support S&P 500 Index earnings, which had a stunning first quarter. While valuations remain somewhat elevated, LPL Research thinks they look reasonable after considering still low interest rates and earnings growth potential.

 

  • Bonds: Safety Features. Inflationary pressure and economic improvement may put additional upward pressure on the 10-year U.S. Treasury LPL Research anticipates the 10-year yield finishing 2021 in the range of 1.75 to 2 percent.

IMPORTANT DISCLOSURES

Please read the full Midyear Outlook 2021: Picking Up Speed publication for additional description and disclosure.

The opinions, statements and forecasts presented herein are general information only and are not intended to provide specific investment advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, please consult your financial professional prior to investing.

Any forward-looking statements including the economic forecasts may not develop as predicted and are subject to change based on future market and other conditions. All performance referenced is historical and is no guarantee of future results.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

Gross domestic product (GDP) is the monetary value of all the finished goods and services produced within a country’s borders in a specific time period, though GDP is usually calculated on an annual basis. It includes all of private and public consumption, government outlays, investments and exports less imports that occur within a defined territory.

The Standard & Poor’s 500 Index is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.

Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price. Bond yields are subject to change. Certain call or special redemption features may exist which could impact yield. Government bonds and Treasury bills are guaranteed by the US government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.