What's going on?

We�ll have what they�re having: JPMorgan forecasted earlier this week that the world�s stocks will continue to climb this year.

What does this mean?

2021 was a perfect storm for stocks: demand for companies� products and services bounced back as countries reopened, while the world�s governments were more than prepared to pump cash into their economies. So much so, in fact, that key stock indexes in the US and Europe rose by 27% and 22% respectively last year, up to near-record highs.

But JPMorgan thinks stocks have further to run yet, mostly because the risks facing the global economy � like stricter Covid restrictions and a Chinese economic slowdown � are either already �priced into� the markets, or simply won�t happen at all. What�s more, the investment bank reckons company profits will keep growing faster than expected and that inflation will cool down in the second half of the year � both of which should push stocks even higher going forward.

Why should I care?

For markets: Don�t get too comfortable.
It�s hard not to feel a little on edge, mind you: a key valuation measure of the US stock market�s 10 biggest companies is almost as high as it was just before the dot-com bubble burst in 2000. And with central banks likely to raise interest rates any day now, stocks are actually looking pretty vulnerable ��at least in the short term. Wells Fargo thinks so, anyway: the bank just said it thinks the US stock market could fall 10% in the next few months.

Zooming out: Gold�s old news.
If JPMorgan�s wrong about a drop-off in inflation, investors might increasingly turn to �stores of value� ��assets that hold their worth over time. Gold�s been a top choice for� well, ever, but Goldman Sachs predicted this week that bitcoin will keep eating into the big dog�s market share as everyday investors increasingly adopt digital assets. And if that does happen, the investment bank reckons bitcoin could hit $100,000 in the next five years.