Markets may bottom out soon, but a sustained recovery is unlikely: Nomura

A sustained recovery in Asian markets, Nomura said, will largely depend on how the Covid situation and the ensuing curbs put in place to combat the pandemic in China plays out going ahead

A ‘mechanical’ bottom is likely in stock markets in the next few weeks, but a sustained recovery is unlikely, said analysts at Nomura in a recent report. Stocks, Nomura said, have historically bottomed out during recessions but not before, and do not bottom out when policy rates are still rising. That said, it expects Asian markets to recover ahead of their US peers.

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“Assuming no major stimulus and/or reopening in China in the months ahead, we do not think conditions are in place to call