Investors should be cautious about venturing into the stock markets right now, but in the long term equities should make up the majority of an investment portfolio because they deliver the best returns over time.That is the view of Henk Potts, director of global investment strategy at Barclays Wealth, who expects economic growth to continue in the US and China, while he said recession in the Eurozone this year would give way to anaemic growth next year.Mr Potts was speaking in a session on the global market outlook at the Bermuda Captive Conference yesterday, along with HSBC Securities US economist Ryan Wang.Delegates heard some thought-provoking views from both speakers, including Mr Potts’ view that African economies had huge potential for growth and Mr Wang’s suggestion that the US had already been undergoing austerity during the past three years.Barclays expects gross domestic product to rise 2.4 percent in the US this year and 2.5 percent in 2013, while HSBC sees growth of 1.7 percent this year and next year.Both expect the Eurozone economies to contract this year by between 0.3 percent and 0.6 percent, followed by growth of less than one percent in 2013. Both expect the Chinese economy to grow at a rate of between eight and nine percent in 2012 and 2013.Mr Potts said the problems in Europe overshadowed the markets right now, with the election in Greece, which will give a good indication of whether the country wants to stay in the euro or not, due to take place on June 17.Although Greece made up just two percent of the Eurozone’s GDP, there were real fears that Greek exit would lead to contagion and fragmentation of the currency union, he said.Mr Potts said he expected to see moves toward further economic integration, including a zone-wide deposit guarantee scheme and perhaps “Eurobonds”.Potential obstacles to integration were German opposition and countries having to give up some sovereignty.“The number one problem is that what makes good political sense in the short term often does not make good economic sense in the long term,” Mr Potts said.He said there were good prospects for economic growth in the US, which had created more than four million jobs in the past three years and where he expected unemployment to fall to 7.8 percent by year-end.The growing middle class in China — estimated at 55 percent of the population today rising to 75 percent by 2025 — would help to fuel growth in a country with a 25 percent savings rate and plenty of room for expansion.“Today we see China as a manufacturing powerhouse, but increasingly we will see China as a consumption powerhouse,” Mr Potts said.He saw huge long-term growth prospects for the “lion economies” of Africa, a continent which now produces 2.5 percent of global output.He said many African economies had been growing at a rate of six percent or more over the past decade, and a population explosion was happening, with one billion Africans expected to become two billion in 40 years.Mr Wang told delegates that there was much talk of the need for austerity in Europe, but he believed the US had effectively been experiencing austerity during the past three years.“At the federal level, government debt has been rising rapidly as a percentage of GDP,” he said. “But at the state and local government level, debt as a percentage of GDP has actually been falling.”This has come about because of the stricter budgetary limits at local level and had resulted in shrinking public-sector payrolls, as well as cutbacks in public construction projects, he added.