The historic run-up in world shares will continue through 2019, but the outlook for almost half of the major bourses polled by Reuters has slipped, with many now only expected to recoup losses from this year's sell-off.
Following a strong performance in 2017, world shares hit their latest run of new highs this month on solid economic and corporate earnings growth. But rising interest rates and concerns about escalating trade tensions have made the direction of travel more turbulent and trade more volatile.
"We expect markets to remain choppy in the months ahead as investors weigh up the various conflicting influences that are now in play. The volatility that we anticipate will at times be a source of discomfort for investors, but it will also be a source of opportunity," said Paul O'Connor, head of the multi-asset team at Janus Henderson Investors.
The consensus from over 300 equity strategists and brokers around the world shows all the indexes polled by Reuters to rise further through to the end of next year, including predictions for the blizzard of records to continue for some of the bourses.
But none of those indexes were forecast to rise more this year than they did in 2017. Predictions for nearly half of those indexes were also tempered in the latest poll, taken Aug. 17-30, compared with a survey just three months ago.
Nearly a decade of easy monetary policy, which fueled the current bull run, has resulted in stretched share prices, with the price-to-earnings ratios in a majority of stock indexes already trading above long-term averages.
Strategists have previously said corporate earnings growth should be a result of capital business expenditure and not the current trend of stock buybacks.
Nearly half of 66 strategists who answered a separate question said the switch from share buybacks to substantial business investment is not likely to happen anytime soon.
Only five said it would happen this year, 18 said it would happen next year, and 11 said in 2020.
"We maintain that there is clear evidence that funds originally earmarked for capital investment are being redirected to share buybacks, and that this trend is likely to continue for so long as geopolitical and trade-related uncertainties remain elevated," noted Robert Phipps, chief investment officer at Per Stirling Capital Management.
"Companies know that they can boost earnings per share by reducing the number of shares outstanding. However, they are unlikely to make long-term capital investments for so long as there is so much uncertainty - particularly trade-related uncertainty - on a global basis."