Investment banks such as Citigroup, Goldman Sachs and Nomura Holdings all forecast more than 20% profit growth for Asian shares next year. Citi and Nomura expect a 5% to 7% increase in the MSCI Asia Index excluding Japan, while Goldman Sachs forecasts a 9% increase for the Asia-Pacific region by 2021.

MSCI index chart for Asia (excluding Japan)

"We remain optimistic about the 2021 outlook driven by the recovery of the macro and profitability and we will be buyers at any point the market corrects," said a group of strategists. Goldman Sachs including Timothy Moe wrote in a note published Sunday (December 13).

Asian stocks are ending a year with unprecedented strong gains as the MSCI Asia index except Japan regained its slumps during a pandemic that just started to break out and rose 18. % from the beginning of the year to Monday (December 14).

Besides, stock indices in South Korea and Taiwan, where many technology stocks have led the gains.

Citi analysts including Robert Buckland wrote in a note last week with forecasts for South Korea’s return per share (EPS) growth for 2021 to skyrocket by 43%.

European financial services analyst Societe Generale wrote in a published note on November 11 that profit growth is shifting to cyclical sectors, such as materials. and finance.

According to Goldman Sachs, a further sharp increase in profits in Asian stock markets next year will be the expectation of a return to profits in 2022.

“With strong market returns this year and full valuations, the market has reflected next year’s earnings recovery. Therefore, the profit level in 2022 will be the main driver of profit in 2021 ”, according to Goldman Sachs.

In addition, Goldman Sachs forecasts Asia’s profits will increase at 16% in 2022.