LIVE MARKETS-Panmure Liberum expects the music to keep playing

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PANMURE LIBERUM EXPECTS THE MUSIC TO KEEP PLAYING

2026 has begun on a positive note for global stocks, with new records in Europe, the UK, the U.S., Japan and South Korea.

British investment bank Panmure Liberum expects stock markets to continue performing well this year and sees the FTSE 100 .FTSE, FTSE Small Cap .FTSC, STOXX 600 .STOXX and S&P 500 .SPX all scoring high single-digit price returns this year.

"In the UK and Europe, the volume is dialled up as large fiscal spending programmes on defence and infrastructure boost GDP growth and stock market returns alike," say Panmure Liberum research analysts Joachim Klement and Susana Cruz in the firm's 2026 outlook.

"In the U.S., we expect the Fed to cut rates aggressively, creating an artificial boost before the music stops in 2027/28."

So what could cause the music to stop sooner?

"Unwinding AI trades could trigger a bear market and several years of poor returns," Klement and Cruz say.

"If fiscal spending doesn’t boost growth, the UK and Europe will underperform."

(Samuel Indyk)

EARLIER ON LIVE MARKETS:

MIXED START FOR EUROPE, STOXX 600 INCHES UP TO ANOTHER RECORD CLICK HERE

EUROPE BEFORE THE BELL: FUTURES IN THE GREEN CLICK HERE

STOCKS KEEP CALM, CARRY ON RECORD RUN CLICK HERE