013, said Merrill Lynch Wealth Management chief investment officer for Europe, Middle East and Africa Bill O’Neill at a press conference in Tel Aviv today. The Israeli economy is in very good shape in global comparison and will grow by 3% in 2013, said Merrill Lynch Wealth Management chief investment officer for Europe, Middle East and Africa Bill O’Neill at a press conference in Tel Aviv today. He said that the recent geopolitical events would not have long-term consequences.
O’Neill doubts that the Bank of Israel will cut the interest rate anytime soon, given the upcoming elections and sensitive political situation.
He added that Israel’s inflation was balanced, and that the shekel was extraordinarily balanced and stable against the dollar. He also said that most activity in Israel would focus on the consumer sector and that home prices would be stable in the near term.
O’Neill concluded by recommending investment in Israeli stocks over bonds.
Globally, O’Neill says in a new report that the economic and market outlook for 2013 is brighter than in 2012. He sees increased evidence of the Federal Reserve’s progress in rekindling the US economy and even a gradual eurozone recovery in prospect during the second half. In addition, in China GDP growth is forecast to improve slightly.
Growth should begin taking over from policy as the key focus for investors next year,” says O’Neill. “This leads us to favor equities over bonds in 2013. The notable valuation gap between the two asset classes, now at its most favorable level for stocks in over 25 years, adds to our conviction here.”