Earlier this month when I provided a quick halftime look at my 2013 calls, I promised I’d provide more details on my updated mid-year outlook now that the second half has begun.

In a new piece, “What’s Next: The Critical Answers”, I do just that. In this outlook update, my fellow authors – Jeff Rosenberg, BlackRock’s chief fixed income investment strategist, and Peter Hayes, head of the firm’s municipal bonds group – and I answer common questions we’re hearing from investors at the mid-year mark. Here’s a short Q&A inspired by the new piece.

Q: Will global stocks go higher this year?

A: Stocks should continue to advance for the next six to 12 months, though the gains will likely be muted and accompanied by volatility. I covered the four reasons why stocks can move higher in a recent post.

Q: When will the Fed begin changing policy and what impact will that have?

A: I foresee the Federal Reserve (Fed) beginning to gradually wind down its asset purchase programs as early as this fall. But though nominal rates may continue to overshoot to the upside in the near term and the long-term direction of rates is higher, I believe the 10-year Treasury yield will hover around 2.5% for the foreseeable future given the many factors keeping a lid on rates.

Q: What is the state of the global economy? Are risks from Europe receding?

A: The global economy remains in slow growth mode, with less risk of widespread recession than in the recent past. Japan is a bright spot, but Europe remains a source of risk.

Q: Where are the best opportunities in stocks?

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