Corporate-profit growth, in the near term, can continue to “stay strong,” but investors and others should watch the global slowdown closely, said Neel Kashkari, head of global equities at PIMCO, on Friday.
“The big question mark is the slowdown in the global economy. All of the recent data suggest that the global economy is slowing and the U.S. economy is slowing,” Kashkari said on Bloomberg TV. “So we think there is going to be some pressure on corporate margins, but overall corporate margins can stay fairly strong in the near future.”
PIMCO, he says, is being very selective about the equity investments it makes. Still, Kashkari said, “We are not forecasting a global recession or a recession in the United States.”
The global economy has had about “three years and counting” of a deleveraging cycle, with several more years to come, he added.