A more positive outlook for equities

Significant interest rate cuts in the US since January will help to underwrite a return to stronger economic growth this year, and a more constructive backdrop for corporate profits into 2002. Nevertheless, there are concerns about the type of recovery we can expect in the US. Consumer spending, for example, has held up well over the past year, and consumer confidence indicators continue to be strong. This means there is a lack of pent-up demand from the consumer going into a recovery, which usually helps to kick-start a recovery. Furthermore, over-supply in the technology sec...