NEW YORK (TheStreet) -- Developed market central banks will ensure equities remain the only game in town for investors.
That's the message from strategists, even as they are split on the prospect of further stimulus from the Bank of Japan this month. But all agree on one thing: the BoJ will do whatever it takes to help that economy.
In Europe, central bank President Mario Draghi has also reiterated a trigger-happy approach to stimulus. "We are resolute in our determination to maintain a high degree of monetary accommodation and to act swiftly if required," he told reporters this week, as the ECB kept rates on hold at 0.25%.
Any central bank stimulus that acts to keep borrowing rates low will continue to bolster the relative appeal of shares over other asset classes. As such, some strategists say tepid economic data will be largely overlooked in economies where stimulus is used or likely to be used. The exception may be the U.S. where stimulus is being wound back on the premise that economic growth can be self-sustaining. Still, any addition to the global stimulus pool from Japan, Europe or China is expected to boost U.S. shares.
The Bank of Japan's meeting this month will face particular scrutiny given the Nikkei's recent lackluster performance. After notching 52.4% in 2013, the Nikkei has shed 5.3% for the year to date.
"We probably will see (more) stimulus and the market is hoping for it, they are committed to doing whatever it takes to jumpstart the economy," ING U.S. Investment market strategist Karyn Cavanaugh said in a phone interview. Japanese GDP notched just 0.7% in the final quarter of 2013, with poor results for capital expenditure and consumer spending.