The global financial crisis is over: Nomura
The global financial crisis will not dominate stock markets next year, according to Japanese investment bank Nomura - because it has come to an end.
In a note entitled "You've got to earn, baby, earn" published Tuesday, the bank's equity research team led by Michael Kurtz said that as a result, it had shifted its global equity strategy approach for 2014.
"There wasn't any memo, but FYI the Global Financial Crisis is over," Kurtz wrote.
(Read more: Oppenheimer has a wild 2014 market prediction)
As evidence for this, he identified a string of improving economic indicators including the strengthening of the U.S.' property market, a reduction in the U.S.-China current account balance, the narrowing of cost differentials between Europe's core and periphery and the expansion of Europe's economy.
"Looking forward, we thus see 2014 as a year in which macrosystemic risks will not dominate equity performance – unfinished QE 'taper' business notwithstanding – but equally as a result, a year in which returns will not be spirited along by 'risk compression' and multiple expansion either," he wrote.
Instead, he said the performance of stocks in 2014 would depend on whether they delivered earnings - and "the good news is, 2014 should serve up a reasonably robust growth platform for global corporate earnings." Global nominal gross domestic product (GDP) growth will hit 7 percent next year, according to Nomura, from 6.1 percent in 2013.
But not all banks have issued such bullish outlooks on stocks for next year. Last week, analysts at HSBC said that although stocks across the globe won't see quite the same "risk-on" rally that this year has brought, 2014 looks likely to be a "lackluster" year for equities.
(Read more: Goldman predicts steep losses for gold in 2014)
And Steen Jakobsen, chief economist at Saxo Bank, has told CNBC on several occasions recently that bullish investors are "chasing the tail" of the recent equity rally, indicating that now is not the time to be risky.
Even fellow Nomura strategist Bob Janjuah – who is known to be uber-bearish – said in a note earlier this month that he expects a 25-50 percent sell-off over the last three quarters of 2014 in global stock markets.
The Nomura team led by Kurtz did stress that next year's economic growth would be "unevenly skewed" toward developed economies, with expansion in emerging markets expected to plateau, and China's growth continuing to slow.
As such, the best earnings growth next year would likely be in Japan (19 percent) and continental Europe, excluding the U.K. (14 percent), according to Kurtz. He said the Asia-Pacific market, excluding Japan, was also expected to be overweight.
By contrast, the U.S.'s expected economic recovery could weigh on earnings, "as overly ambitious profit-margin expectations collide with rising capital costs and a (gradually) strengthening labor market."
(Read more: Australia to be 'odd one out' in 2014: Goldman Sachs)
The bank said EPS (earnings per share) growth for the S&P 500 was forecast at 6 percent for 2014.
Nomura's forecasts for next year marked an "important qualitative change" from the approach going into both 2012 and 2013, when investors could make the most of "end-of-the-world risk premiums" – as long as the global economy did not implode.
By contrast, in 2014 much of the so-called "deep value" argument for stocks had played out, Kurtz said.
"From here, equities will increasingly require more of a growth rationale for upside, rather than the macro-risk compression of 2012-13," he wrote.
As such, Nomura forecast 10 percent EPS growth for the MSCI AC World benchmark of global stocks in 2014.