The outgoing year was certainly a remarkable one for equities – with markets in both the U.S. and Europe posting double-digit gains. But analysts have warned that 2014 is unlikely to prove so lucrative for stocks, although America is expected to outperform Europe yet again.
U.S. stocks ended 2013 at record highs, with the S&P 500 posting its largest annual jump in 16 years and the Dow its biggest gain in 18 years. While across the Atlantic, the pan-European benchmark STOXX 600 clocked gains of 17 percent, after a year in which faith in a euro zone recovery returned to the markets.
"You've got to wonder how much of that we're going to be able to keep into the next year," Daniel Morris, global strategist at TIAA-CREF Asset Management told CNBC on Thursday – the first trading day of the year for most major markets. "So consequentially, (we have) pretty modest expectations for returns for equities in 2014."
That view is shared by Brenda Kelly, chief market strategist at IG.
"If you look where we are in the cycle at the moment, we have seen record levels for American stocks. You have to question whether we can see the same type of returns and I don't think that is totally possible," Kelly told CNBC.
(Read more: Wall Street closes 2013 at records)
Although another blow-out year might not be on the cards, analysts expect strong economic growth – particular in the U.S., where gross domestic product (GDP) grew at a 4.1 percent annual rate in the third quarter – to continue to drive equities.
Morris, for instance, expects the U.S. economy to accelerate evenly throughout 2014, forecasting economic growth of between 2.5-3 percent for the U.S., although "certainly less for Europe."