Markets are acting like a recession isn’t on the way: Strategist - BNN Bloomberg

The equity and bond markets are not pricing in the very elevated risk of a recession that is likely to begin in the second half of this year, HSBC’s global chief strategist Joseph Little told BNN Bloomberg in a TV interview on Wednesday. “The strength of developed equity markets the resilience of the credit markets we think is a bit out of step with how fundamentals are evolving,” he said.

“When you have that amount of monetary tightening taking place, it almost always ends up creating a slowdown and a recession,” he explained. This dip in economic activity will ultimately lead to higher unemployment levels and a contraction in gross domestic product , which gives him pause when looking to invest in western markets, Little said. For now, he said the emerging markets can offer investors more opportunities than the developed markets.

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